Source:
The HillThe House is expected to approve legislation this week that would repeal an IRS plan to withhold 3 percent of payments to contractors at every level of government.
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Critics of the repeal drive say lawmakers are removing what would be a tough enforcement mechanism for the IRS to help close the gap between what taxes are owed and what’s actually collected.
“It’s the latest sad reversal of cutting down on tax cheating,” said Chuck Marr, director of federal tax policy for the liberal-leaning Center on Budget and Policy Priorities. “Withholding is a very effective way to enforce the tax code.”
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The lost revenue will be offset by legislation sponsored by Rep. Diane Black (R-Tenn.) that sets strict limits on Medicaid eligibility — a move that was also recommended by the president to the supercommittee. Black’s bill will also be voted on Thursday, the aide said.
Read more:
http://thehill.com/business-a-lobbying/189769-lobbyists-claim-victory-against-withholding-tax