Republicans' plan to fund Israel by cutting IRS spending would cost taxpayers billions and add to the national deficit

• Republicans proposed giving Israel $14 billion, attached to $14 billion in IRS funding cuts.
• The nonpartisan Congressional Budget Office said the proposal would cut revenue by $26 billion.

Republicans want to give Israel $14.3 billion — but only if they can cut the same amount from the IRS.

One of the new Speaker of the House Mike Johnson's first actions was proposing a bill to fund Israel as it continues its war against Palestinian militant group Hamas. While Senate Democrats, and President Joe Biden, requested emergency funding for the country without any conditions attached, Johnson did not oblige — he attached $14 billion in funding cuts for the Internal Revenue Service.

According to a new report from the nonpartisan Congressional Budget Office, that proposal to cut IRS enforcement would result in $26 billion in lost revenue.

"House Republicans' legislation would increase the deficit by helping wealthy individuals and corporations cheat on their taxes, increasing the tax burden on honest, hardworking families who pay their taxes with every paycheck," Treasury spokesperson Ashley Schapitl said in a statement to Insider.

In an interview with the Washington Post, IRS Commissioner Daniel Werfel said that Republicans' plan "would actually cost taxpayers $90 billion — that's with a 'B,'" over the course of the Inflation Reduction Act.

This isn't the first time that Republicans have attempted to claw back some of the $80 billion that Biden's tax and healthcare economic package allocated to the IRS. Under former Speaker Kevin McCarthy, the GOP proposed legislation that would completely rescind that IRS funding; the nonpartisan Congressional Budget Office estimated that that legislation would add a net $114 billion to the budget.

While Republicans were successful in clawing back $21 billion through legislation to raise the debt ceiling, the IRS has started putting the rest towards cracking down on ultra wealthy taxpayers who aren't paying their fair share. The agency recently said it squeezed $122 million more in owed taxes from just 100 millionaires — which came after it collected $38 million from 175 other high-earners. Currently, the agency is contacting 1,500 more millionaires that owe over $250,000.

"Thanks to the Inflation Reduction Act, the IRS has already recovered $160 million from 275 individuals who make more than $1 million a year and have $250,000 in recognized tax debt, without increasing audits on those earning less than $400,000 a year," Schapitl said. "This legislation would put a stop to these efforts, allowing wealthy individuals and large corporations to continue to get away with not paying their fair share."

The bill was essentially dead on arrival in both the Senate and White House. Senate Majority Leader Chuck Schumer wrote on X, formerly Twitter, on Tuesday that "the House GOP bill has the hard right's fingerprints all over it: It makes aid for Israel contingent on poison pills that reward ultra-wealthy tax cheats. It's insulting that the hard right is openly trying to exploit the crisis in Israel to try and reward the ultra-rich."

The Office of Management and Budget also said in a Tuesday statement that if the bill makes it to Biden's desk, he would veto it.

"Congress has consistently worked in a bipartisan manner to provide security assistance to Israel, and this bill threatens to unnecessarily undermine that longstanding approach," the OMB said. "Bifurcating Israel security assistance from the other priorities in the national security supplemental will have global consequences."

Republicans will likely have to propose a cleaner bill in order to get aid to Israel as soon as possible. Still, it likely will not be without any spending cuts — Senate Minority Leader Mitch McConnell said on Tuesday that he is in "conceptually the same place" as Schumer when it comes to sending aid to both Israel and Ukraine, but Democrats would likely have to accept stronger border provisions in any eventual legislation.