US banking lobby groups oppose proposed tax reporting law

The largest US banking lobby groups banded together on Friday to make another push to kill a proposed bank account reporting law being drawn up as part of the congressional reconciliation package.

In a letter to US House of Representatives Speaker Nancy Pelosi and House Minority Leader Kevin McCarthy, the lobby groups said the proposal would create “reputational challenges” for large financial services firms, increase the cost of tax preparations for Americans and small businesses, and create serious “financial privacy concerns”.

“We urge members to oppose any efforts to advance this ill-advised new reporting regime,” the groups said in the letter.

“While the stated goal of this vast data collection is to uncover tax dodging by the wealthy, this proposal is not remotely targeted to that purpose or that population.”

The proposed domestic account reporting requirement in the $3.5 trillion House package is becoming an important issue for the banking industry, which is opposed to the tax reporting changes that are being pushed forward by the Democrats.