The IRS Admits It Doesn’t Audit the Rich Because It’s Too Hard
The Internal Revenue Service is in a bind. The agency's job is to collect the taxes that fund everything else in the government, from Social Security to the Post Office to Medicaid to the military's endless conflicts across the globe. But the IRS is struggling: According to Vox, Americans owe a cumulative $131 billion in unpaid taxes, enough to completely fund the Department of Education for two years. The bulk of that money is owed by the wealthiest people in the country, yet the IRS isn't attempting to collect it from them. Instead, as IRS Commissioner Charles Rettig confirmed in a letter to Congress recently, the agency literally can't afford to audit the rich, so it's pursuing the poor instead.
ProPublica has published multiple stories on the sad state of the modern IRS over the past year. They found that a person is more likely to get audited if they make $20,000 a year than if they make $400,000. That's because it takes a lot less time, money, and people to investigate someone who receives the earned income tax credit, one of the government's largest anti-poverty programs, than it does to look into the complicated holdings and filings of someone else making 20 times as much. And even further up the economic ladder, things aren't any better: Millionaires were 80 percent less likely to be audited in 2018 than they were in 2011.
This is the direct result of years of conservative-led efforts to successfully defund, defang, and delegitimize the IRS. Over the past eight years, Congress has steadily reduced the agency's enforcement budget by billions of dollars, down 25 percent from what it was in 2008. And by cutting out only relatively small chunks at a time, the gutting has largely avoided public outcry. Unsurprisingly, according to ProPublica, the IRS is in disarray on the inside, resulting in "a bureaucracy on life support."
The cuts are depleting the staff members who help ensure that taxpayers pay what they owe. As of [2017], the IRS had 9,510 auditors. That’s down a third from 2010. The last time the IRS had fewer than 10,000 revenue agents was 1953, when the economy was a seventh of its current size. And the IRS is still shrinking. Almost a third of its remaining employees will be eligible to retire in the next year, and with morale plummeting, many of them will.
ProPublica estimates that as a result, the U.S. is losing at least $18 billion dollars in revenue each year. In a letter to Congress, Rettig told Democratic senator Ron Wyden of Oregon that he and the agency are well aware that it would be far more lucrative and productive to pursue tax fraud and evasion of the wealthiest Americans, but without Congress restoring its budget, there's no way to make that happen.
This is part and parcel of a Republican political strategy otherwise known as "starving the beast." So-called "fiscal conservatives" like Paul Ryan claim that the federal government can't properly run basically anything, and use that as justification for cutting funding, support, and resources to agencies like, say, the IRS. Once an agency starts underperforming because of its slashed budget, that's used as still more evidence that government can't effectively do its job. Deliberately mismanaging the federal government, then, is a central tenet of modern-day conservatism.
This makes the results of the GOP's 2017 tax cuts all the more galling. While the corporate tax rate was practically cut in half, the average person saw their taxes go down by barely 4 percent. While railing against taxes is a standard battle cry for congressional Republicans, their history and actions make it clear that they're only interested in making sure the richest people pay less. Everyone else is fair game.
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Originally Appeared on GQ
