Thursday, March 16, 2017
Democracy: A Journal of Ideas: Making Tax Evasion Great: The $100 Billion Giveaway, by Robert Gordon & David Kamin (NYU):
The President may talk about “law and order,” but apparently he excludes tax law.
President Trump’s Office of Management and Budget has proposed a 14.1 percent cut in funding for the Internal Revenue Service. If made permanent, we conservatively estimate that this cut will cost the Treasury $60 billion, just from direct revenue loss due to reduced enforcement (and netting out the reduced spending on IRS enforcement). This new cut follows a more than 20 percent real reduction in resources for IRS enforcement since 2010. Undoing that reduction could save the federal government an additional $30 to $40 billion. All together, the President’s failing to restore these previous cuts and then cutting even more allows handouts to tax evaders costing the Treasury about $100 billion over ten years.
For several reasons, these figures probably substantially understate the effects on the federal budget.