MSCI, Business Community Allies Successfully Defeat Financial Reporting Provision

As Connecting the Dots has reported before, earlier this year President Joe Biden proposed a plan that would require all U.S. financial institutions to report annually on accounts with deposits and withdrawals worth more than $600. The idea, which would apply to everything from loans to payroll, was aimed at cracking down on taxpayers who cheat on their annual returns.

Led by small financial institutions, the business community, including MSCI, mobilized over the summer to oppose the idea. Still, up until last Thursday, Democrats were considering adding the provision to their Build Back Better budget reconciliation as a means to pay for new spending on social programs. In fact, as of last Monday, it seemed like Democrats would keep the idea on the table, but raise the reporting threshold to $10,000.

MSCI already had signed several letters opposing this idea and, last week, added its name to one more opposing the increased threshold. That letter, signed by more than 100 organizations, went to President Joe Biden and argued, “The privacy concerns for Americans who pay their taxes and would be swept into this account reporting program are real and should not be taken lightly.” Read Fox Business’s coverage of the letter here. Read the full letter here.

By mid-last week, moderate Sen. Joe Manchin (D-W.Va.) pledged that the provision would be out of the Build Back Better plan and, indeed, when President Biden outlined the new budget framework last week, there was no sign of the reporting requirement.

This victory does not mean the idea could not surface again, but, for now, it seems like Americans will not have to deal with this onerous and costly provision.