Cape News

Chairman Smith has expressed strong support for H.R. 9495, known as the Stop Terror-Financing and Tax Penalties on American Hostages Act. The legislation aims to halt tax subsidies to U.S. nonprofits that have violated their tax-exempt status by supporting terrorist organizations. Additionally, it seeks to protect Americans returning from captivity by ensuring they are not penalized by the IRS for past-due taxes incurred during their detention.

Smith highlighted the bill's unanimous approval by the Ways and Means Committee and its prior bipartisan support in both the House and Senate. Despite this, he noted that most Democrat colleagues blocked its passage last week due to political motivations related to President Trump's election victory.

He criticized those opposing the bill for inventing scenarios of potential abuse of authority granted by the legislation. Smith assured that concerns raised had been addressed within the bill to ensure due process and protection for legitimate nonprofits.

Smith provided examples of U.S.-based tax-exempt entities allegedly supporting terrorism, such as one involved with a journalist linked to Hamas and another sponsoring a foreign entity labeled a sham charity by the Biden Treasury Department. He called on the IRS to revoke these organizations' tax-exempt status, emphasizing that taxpayers should not subsidize such activities.

He urged Congress to act against tax code abuses funding terrorism and end unfair tax treatment of hostages or wrongfully detained Americans, encouraging colleagues to support the legislation.