President Outlines Proposals to Support Fairness and Equity in Our Tax System, Invest in Communities and Small Businesses, and Safeguard the U.S. Financial System from Illicit Actors
WASHINGTON — The Biden-Harris Administration today submitted to Congress the President’s priorities for fiscal year 2022 discretionary spending. The funding request invests in the core foundations of our country’s strength and advances key Treasury Department priorities, including ensuring that all Americans are treated fairly by our tax system, expanding programs that offer loans to start-ups and small businesses to promote affordable housing and community revitalization projects, and closing loopholes that allow illicit actors to evade scrutiny, mask their dealings, and shield illegal activity.
“If you’re an individual taxpayer or a small business, it’s much more difficult to navigate the financial services sector – and America’s tax system – than if you’re a large company,” said Secretary Yellen. “The President’s funding request makes things fairer. It injects capital into communities where capital is usually hard to come by. It will make paying taxes a more seamless process for millions of Americans. And it makes sure that corporations actually pay what they owe.”
The President’s FY22 discretionary request:
- Supports a Fair and Equitable Tax System. To ensure that all Americans are treated fairly by our tax system, including that the wealthy and corporations comply with existing laws, the 2022 discretionary request provides $13.2 billion for the Internal Revenue Service (IRS), $1.2 billion (10.4 percent) above the 2021 enacted level. With this funding, the IRS will increase oversight of high-income and corporate tax returns to ensure compliance; provide new and improved online tools for taxpayers to communicate with the IRS easily and quickly; and improve telephone and in-person taxpayer customer service, including outreach and assistance to underserved communities. In addition to increases for base IRS enforcement funding, the 2022 discretionary request provides an additional increase of $417 million in funding for tax enforcement as part of a multiyear tax initiative that will increase tax compliance and increase revenues. Altogether, the 2022 discretionary request will increase resources for tax enforcement by $0.9 billion.
- Invests in American Communities and Small Businesses. To support and empower the nation’s most vulnerable communities, including many rural communities, the 2022 discretionary request provides $330 million, an increase of 22.2 percent above the 2021 enacted level for annual appropriations, to support expanding the role of Community Development Financial Institutions (CDFIs), which offer loans to start-ups and small businesses to promote the production of affordable housing and community revitalization projects. This investment builds on an unprecedented level of support for the CDFI industry in 2021, including more than $3 billion in direct funding, $9 billion for investments in CDFIs and Minority Depository Institutions, and provisions in the American Rescue Plan encouraging CDFI participation in the $10 billion State Small Business Credit Initiative.
- Increases Corporate Transparency and Safeguards the Financial System. Loopholes in financial reporting requirements undermine corporate accountability and allow illicit actors to evade scrutiny and mask their dealings. The 2022 discretionary request provides $191 million for the Financial Crimes Enforcement Network, $64 million above the 2021 enacted level, to create a database that tracks the ownership and control of certain companies and organizations and helps combat the use of complex corporate structures to shield illegal activity.
These discretionary investments reflect only one element of the President’s broader agenda. In the coming months, the Administration will release the President’s Budget, which will present a unified, comprehensive plan to address the overlapping crises we face in a fiscally and economically responsible way.
For more information on the President’s FY22 discretionary funding request, please visit: https://www.whitehouse.gov/omb/FY-2022-Discretionary-Request/.
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