"The IRS" isn't an independent entity with its own agenda and leadership that persists over time. The deal was, substantively, between the Bush Administration and private interests that the Bush Administration was politically allied with and supported by.
I think theoretically the IRS is happy because they don’t have to build this. Private firms are happy because they get to charge people who are above the AGI limit but still file basically a 1040EZ. The AGI is like $80k, there are for sure people above that who still have basic taxes.
The private firms just got greedy because the IRS hasn’t reeled them in.
Seems to me that a government agency must, above all, have a service goal. Serve the most people the best. If you look at it that way then the IRS creating their own simple filing solution is the only way to go.
Maybe IRS execs still suffer under Reagan-era propaganda? (government is always bad. government should never compete with private industry)
I guess it’s just corruption. business as usual for the US.