Republicans Decry Democrats’ Push For IRS Crackdown On Tax Evasion

by | Aug 3, 2022 | Politics

WASHINGTON — Democrats have ditched their dreams of higher tax rates on individuals and corporations, settling instead for a corporate minimum tax and stricter enforcement of current laws. Merely proposing that the Internal Revenue Service crack down on tax evasion, however, has prompted a fierce Republican response. Advertisement“They’re just gonna go attack every small business person,” Sen. Rick Scott (R-Fla.) told HuffPost. “We know how the IRS treats people. You’re guilty until proven innocent.”The Inflation Reduction Act, which Democrats are hoping to push through the Senate without any Republican votes this month, would boost the IRS budget by $80 billion, with more than half of that going toward enforcement and $3 billion of it for improved customer service. “This is an agency that only succeeded in answering about one out of every 50 phone calls during the 2021 tax season,” Sen. John Thune (R-S.D.) said on the Senate floor Tuesday. “Yet 4% of the $80 billion is going to taxpayer services — 57% goes to enforcement, so that the IRS can spend more time harassing taxpayers around this country.”The U.S. relies on voluntary compliance with its tax code, and the American people collectively underpay their taxes by hundreds of billions annually. Much of the so-called tax gap results from people underreporting non-wage income, such as from sole proprietorships or business partnerships. (Regular wage earners typically have their income reported directly to the IRS and federal income taxes are deducted from their paychecks.) AdvertisementSince there’s so much tax noncompliance, including through willful evasion, stricter IRS enforcement more than pays for itself. Investing $80 billion in the IRS would yield $207 billion in reven …

Article Attribution | Read More at Article Source

Share This