U.S. Senator Elizabeth Warren recently called on the Treasury Department to expedite the process of addressing racial discrimination in the U.S. tax and banking systems. Warren expressed her concerns in a letter to Treasury Secretary Janet Yellen, highlighting the slow implementation of the reforms proposed by the Treasury Advisory Committee on Racial Equity (TACRE) which was established in December 2022. Despite the committee’s efforts and over 40 recommendations made so far, the pace of change has been sluggish, leaving many of the proposed reforms unimplemented.
Barriers to Building Equity
Warren emphasized the importance of these recommendations in improving economic conditions for Black and Brown communities who face significant barriers in building equity and ensuring financial security for their families. The Senator urged Yellen to take immediate action in implementing the recommendations that would benefit these marginalized communities. One of the committee members, Dorothy Brown, a tax lawyer and law professor, voiced her concerns about the lack of enthusiasm from the Treasury in embracing the recommendations, viewing the committee’s efforts as merely a formality.
In her letter, Warren requested that the Treasury brief her staff by May 23 on the timeline for implementing the remaining proposals, which include reforms to the Internal Revenue Service’s auditing process and the creation of outreach tools to ensure that low-income tax credits and green energy credits are accessible to underserved communities. This urgency from Senator Warren reflects the pressing need to address systemic racial discrimination within the tax and banking systems.
Senator Warren’s push for reforms comes amidst President Joe Biden’s efforts to strengthen support within communities of color leading up to the upcoming presidential election. The creation of the committee and its subsequent work have faced scrutiny and opposition from some Republican senators. However, Warren applauds a recent Treasury rulemaking released in March that adopted one of the committee’s recommendations: sharing tax data with the Census Bureau to track racial disparities in tax enforcement more effectively. Despite this positive step, Warren emphasizes the necessity of further action on all proposed reforms.
The implementation of reforms recommended by the Treasury Advisory Committee on Racial Equity is crucial in addressing the disparities in tax enforcement and economic opportunities faced by Black, Latino, and Native American communities. These reforms aim to dismantle the systemic barriers that hinder financial security and wealth-building in these communities. Therefore, it is essential for the Treasury Department to prioritize the swift implementation of these reforms to create a fairer and more inclusive financial system for all Americans.