GOP senator backs Biden IRS nominee despite concerns over funding boost

Daniel Werfel
Greg Nash
Nominee for Commissioner of Internal Revenue Service Daniel Werfel answers questions during his Senate Finance Committee nomination hearing on Wednesday, February 15, 2023.

Sen. Thom Tillis (R-N.C.) said on Wednesday that he intends to support the confirmation of  President Biden’s nominee to head up the Internal Revenue Service (IRS), Danny Werfel.

During Werfel’s confirmation hearing Wednesday before the Senate Finance Committee, Tillis expressed his support for the nominee during a line of questioning about the agency’s recent funding boost.

“I intend to support your confirmation,” Tillis said while pressing Werfel about how the agency plans to use an additional $80 billion in funding approved by Democrats without Republican support last year.

The additional IRS funding, approved as part of the Inflation Reduction Act signed by President Biden last year, was a top issue in the hearing. While Democrats said the additional money is essential to help clear a massive a backlog of tax returns and improve the agency’s ability to serve taxapyers, Republicans expressed concerns over the impact the funding could have on audit rates.

“This is sort of typical of Washington, D.C.,” said Sen. John Cornyn (R-Texas). “We appropriate the money and ask for the plan later, rather than ask for the plan and say, ‘How much money do you need to actually implement the plan?'”

Democrats counter that the additional money will be used to help ensure fair tax treatment for all Americans.

During his hearing, Werfel said the agency stressed the need for “equity” in working toward “effective tax implementation.” He cited the disproportionate rates at which low-income and minority Americans are audited, telling senators,“To achieve equity, I think we should be able to look at the audit footprint and see balance.”

“I don’t think based on what I know now, that there is balance today,” Werfel said. “I’m not at the IRS. But if there is an imbalance that is concerning, especially if there’s a disparate impact on poor people.”

“If poor people are more likely to be audited than wealthy, that is something that I think potentially degrades public trust and needs to be addressed within the tax system,” he added.

Werfel previously served as acting IRS commissioner in 2013 during the Obama administration, taking the role in the wake of a scandal at the agency involving its treatment of certain conservative groups. He also served at the Office of Management and Budget (OMB) during the George W. Bush administration.

Senators expect Werfel will likely to be confirmed to the post, needing just a simple majority of the Democratic-controlled Senate,even as prominent House Republicans openly criticize.

“Recent leaks of taxpayer information have further eroded the American people’s faith in the IRS, and ought to make Mr. Werfel’s record as a former Acting Commissioner the centerpiece of today’s Senate confirmation hearing,” House Ways and Means Committee Chairman Jason Smith (R-Mo.) said in a statement on Wednesday.

“After all, when the tax enforcement agency was found to target conservative non-profits and withheld key information from Congress, Mr. Werfel fell short of restoring trust in the IRS,” he added.

House lawmakers do not vote on presidential nominations but play a key role in oversight of federal agencies.

Tags Danny Werfel Danny Werfel Inflation Reduction Act IRS Joe Biden taxes Thom Tillis

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