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An Overlooked Dimension to OIRA Review of Tax Regulatory Actions

By Kristin E. Hickman. Full Text. 

In April 2018, the Treasury Department and the Office of Information and Regulatory Affairs (OIRA) signed a Memorandum of Agreement reversing an exemption and providing for the first time that significant tax regulatory actions would be subject to OIRA review under Executive Order 12866. The transition to the Biden administration has raised questions whether the Memorandum of Agreement should be reversed and most tax rules and regulations again exempted from OIRA review. Critiques of OIRA review in the tax context generally focus on disagreements over whether the benefit-cost analysis required by Executive Order 12866 is useful or should rely on different methodological assumptions. This Essay emphasizes instead the symbiotic relationship between OIRA review, benefit-cost analysis, and compliance with Administrative Procedure Act procedure and process requirements. Because Treasury and the IRS continue to struggle with both admitting to and satisfying their Administrative Procedure Act responsibilities, this benefit of OIRA review justifies retaining the Memorandum of Agreement and OIRA review of tax regulatory actions.