Gutting FinCEN and Slashing IRS Enforcement: A Recipe for Financial Secrecy
Project 2025's Treasury chapter proposes gutting FinCEN, rolling back Dodd-Frank, and defunding IRS enforcement—moves that have been partially enacted via executive disavowal of the OECD global tax deal (Jan 2025) and House rescission attempts against IRS funding. The distributive consequence: reduced tax compliance on high-income evaders and weakened anti-kleptocracy tools, benefiting wealthy tax avoiders and illicit finance operators at the expense of public revenue and financial integrity.
Project 2025 frames its Treasury agenda as a fight against bureaucratic overreach, but the distributive fingerprints are unmistakable. The Heritage Foundation’s long-standing campaign against the OECD global tax deal—calling it a 'global tax cartel'—has been translated into proposed action, alongside House attempts to rescind $70+ billion in IRS funding from the Inflation Reduction Act. This agenda directly shields the offshore wealth of multinational corporations and ultra-high-net-worth individuals. Meanwhile, the '87,000-person hiring binge' myth, debunked by FactCheck.org and the Tax Policy Center, is used to justify defunding enforcement that targets high-income evaders—not middle-class filers.
The parallel assault on FinCEN and anti-money-laundering obligations—citing privacy concerns—serves the same ends. Weakening Suspicious Activity Report requirements and Bank Secrecy Act compliance reduces the cost of doing business for banks, but it also undermines the U.S. foreign-policy infrastructure that Treasury sanctions rely on. The result is a regulatory environment that makes it easier for kleptocrats, terrorist financiers, and sanctions evaders to move money through the U.S. financial system. The progressive alternative is clear: restore IRS enforcement funding, re-engage with the OECD global minimum tax, and strengthen FinCEN’s capacity to track illicit flows—treating tax compliance and financial transparency as public goods, not burdens on private profit.
The humanitarian alternative
Restore IRS IRA enforcement funding to target high-income noncompliance; rejoin OECD global tax negotiations to implement a minimum effective corporate tax rate; strengthen FinCEN by expanding Beneficial Ownership Information reporting and increasing SAR review staffing; and oppose any rollback of Dodd-Frank's financial stability or AML provisions. This package would reduce the tax gap, curb offshore evasion, and fortify anti-kleptocracy tools.
Rollback path — how this gets undone
This action has already been implemented. These are the concrete levers that could reverse it.
- Rescind presidential memorandum disavowing OECD Global Tax Deal (Jan 20, 2025) The President issues a new memorandum re-engaging with OECD negotiations and directing Treasury to support Pillar Two implementation; Congress should also introduce legislation to adopt the global minimum tax into U.S. law.
- Restore full IRS IRA funding via appropriations and enforcement directives Congress should fully fund the IRS at the IRA levels ($80 billion over 10 years) in annual appropriations, reversing any rescissions; Treasury should direct IRS to prioritize audits of high-income taxpayers, partnerships, and corporations.
Original source — excerpted
project2025 Project 2025 ch. 25: Small Business Administration (pp 746-747)"— 713 — Department of the Treasury David R. Burton “Towards a Global Tax Cartel?” Policy, Vol. 18, No. 4 (Summer 2002–2003), Center for Independent Studies (Australia), https:/ /www.cis.org.au/wp-content/uploads/2015/04/images/stories/policy- magazine/2002-summer/2002-18-4-david-r-burton.pdf (accessed March 19, 2023). 33. Roberts et al., “Organization for Economic Co-operation and Development (OECD).” 34. See Inflation Reduction Act, § 10301. See also Preston Brashers, “IRS and Allies Downplay 87,000-Person Hiring Binge,” The Daily Signal, August 12, 2022, https:/ /www.dailysignal.com/2022/08/12/the-irs-and-its- allies-downplay-87000-person-hiring-binge/ (accessed March 19, 2023). 35. U.S. Department of the Treasury, General Explanations of the Administration’s Fiscal Year 2022 Revenue Proposals, May 2021, pp. 88–89, https:/ /home.treasury.gov/system/files/131/General-Explanations-FY2022.pdf (accessed March 19. 2023). 36. See U.S. Department of the Treasury, Fiscal Year 2022–2026 Strategic Plan. 37. U.S. House of Representatives, Committee on Oversight and Reform, Policy and Supporting Positions, December 2020 (the “plumb book”), p. 127 https:/ /www.govinfo.gov/content/pk…"