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Capitol Hill is headed for a showdown over foreign military aid, after House Republicans unveiled a bill that would pay for $14.3 billion in assistance to Israel by slashing funding from the IRS.
It’s the first major piece of GOP legislation unveiled under new Speaker Mike Johnson, who has argued that any emergency aid should be balanced by cuts elsewhere in the budget. “If you put this to the American people and they weigh the two needs, I think they’re going to say standing with Israel and protecting the innocent over there is in our national interest and is a more immediate need than IRS agents,” he told Fox News.
Democrats quickly dismissed the 13-page bill as “dead on arrival” in the Senate, and accused Republicans of holding a key ally’s security needs hostage in order to help tax dodgers.
“This Republican proposal is just horrifying. It’s a complete non-starter,” Senate Finance Chair Ron Wyden, D-Ore., told reporters. “The idea that somehow you would basically condition support for Israel on giveaways to wealthy tax cheats takes your breath away.”
The Biden administration has asked for a single $105 billion emergency funding package that would include aid for both Israel and Ukraine. On Monday, White House Press Secretary Karine Jean-Pierre attacked the House’s new proposal for trying to split funding for the two countries, and said the GOP’s demand to offset emergency spending with cuts would set an “unacceptable precedent” with “devastating implications” for US national security.
Democrats included $80 billion of additional funding for the IRS in the Inflation Reduction Act to help the tax agency modernize its systems and crack down on tax evasion. Clawing that funding back has been a top priority this year for conservatives. House Republicans already won a major victory on that front in the debt ceiling deal in May, which included a $21.4 billion cut to the tax agency’s budget.
But Democrats point out that any cuts to the IRS’s funding would likely lead to higher deficits, by hurting collection efforts. The Committee for a Responsible Federal Budget said the GOP bill would add about $30 billion in red ink over a decade.Other independent analyses indicate IRS funding provides at least a two-fold return from stepping up audits on the ultra-rich.
Even some GOP lawmakers appear to be wary of the new House measure. “It’d be nice if all spending was offset, but it’s not,” Sen. Mitt Romney, R-Utah, told Semafor. “I personally don’t think that reducing our tax collections by shrinking the IRS is the way to do that.”
In the House, Rep. Joe Wilson, R-S.C. — who chairs the Foreign Affairs panel’s Middle East, North Africa and Central Asia Subcommittee — joined a bipartisan letter criticizing the new GOP proposal.
“The introduction of offsets, or the potential deferral of our commitments, threatens not only our national interest, but also our long-term fiscal health,” the letter states. “It is far better and less costly in blood and treasure to ensure Russia, Iran, and Hamas are defeated in their current wars than it will be if they achieve strategic victories against Ukraine or Israel.
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Johnson’s legislation is likely on a collision course as well with Senate Minority Leader Mitch McConnell, who supports combining aid for Israel and Ukraine into a single package.
On Monday, McConnell reiterated his call to approve aid for both nations in tandem, saying the Senate has an opportunity “to prevent further loss of life and to impose real consequences on the tyrants who have terrorized the people of Ukraine and of Israel.”
Another key Senate Republican, Sen. Susan Collins, R-Maine also told reporters on Monday that she didn’t like the idea of separating Israel and Ukraine aid. “I think both are extremely important priorities, and both are in our national interests,” she said.
But cracks could be emerging in the Senate GOP, and some believed the House bill represented the start of difficult bipartisan negotiations over the scope and composition of a supplemental funding package, which some Republicans are hoping to use as a vehicle for other major policy demands.
“We really want border security,” Sen. JD Vance, R-Ohio, told reporters. “We shouldn’t just roll over and give them everything they want without asking for anything in return.”
The View From West Virginia
One prominent Senate Democrat appeared unphased by the House GOP’s proposal, however. “It doesn’t bother me,” Sen. Joe Manchin, D-W.Va., an architect of the Inflation Reduction Act, said. He later told Semafor that he was comfortable with cutting some IRS funding, and chiefly wants to ensure the tax agency has enough money to update its antiquated technology.
“You have got to have enough money invested in the IRS to do the job it needs to do for our country, and making sure people pay their fair share of the tax,” Manchin said.
Kadia Goba contributed reporting