H.R.425 - Repealing Big Brother Overreach Act (119th Congress)
Summary
H.R.425, the "Repealing Big Brother Overreach Act," seeks to repeal the Corporate Transparency Act (CTA). The CTA, enacted as part of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, mandates reporting requirements for certain business entities. This bill aims to eliminate these requirements, arguing they represent governmental overreach.
Expected Effects
If enacted, H.R.425 would remove the reporting obligations placed on businesses by the Corporate Transparency Act. This would eliminate the need for companies to disclose beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). The repeal would also necessitate technical amendments to existing sections of the United States Code to remove references to the repealed CTA.
Potential Benefits
- Reduced compliance costs for small businesses, freeing up resources for growth.
- Decreased regulatory burden, potentially encouraging new business formation.
- Increased privacy for business owners, shielding their information from government scrutiny.
- Elimination of potential for government overreach and misuse of collected data.
- Simplification of the legal and regulatory landscape.
Potential Disadvantages
- Weakened efforts to combat money laundering and terrorist financing.
- Reduced transparency in corporate ownership, potentially aiding illicit activities.
- Increased difficulty in identifying and prosecuting financial crimes.
- Potential erosion of national security by hindering efforts to track illicit funds.
- Damage to the United States' international reputation in combating financial crime.
Constitutional Alignment
The bill's constitutionality is primarily tied to Congress's power to regulate commerce (Article I, Section 8) and its implied powers under the Necessary and Proper Clause (Article I, Section 8, Clause 18). The original Corporate Transparency Act was justified under these powers as a means to combat financial crimes that affect interstate and international commerce. Repealing the CTA could be argued as a valid exercise of legislative power to modify or repeal existing laws. However, opponents might argue that it undermines the government's ability to combat illicit activities, potentially jeopardizing national security and the general welfare.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).