Congress just cut IRS funding. It costs even more than we thought. - Washington Post https://www.washingtonpost.com/opinions/interactive/2023/irs-enforcement-costs-congress-funding/

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"The White House and Congress recently agreed to claw back more than $20 billion earmarked for the Internal Revenue Service. This deal was, ostensibly, part of a grand bargain to reduce budget deficits.

Unfortunately, it’s likely to have the opposite effect. Every dollar available for auditing taxpayers generates many times that amount for government coffers — and the rate of return is especially astonishing for audits of the wealthiest Americans, according to new research shared exclusively with The Post.
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This means that while the upfront costs of auditing the wealthy are usually higher — perhaps suggesting these taxpayers aren’t worth going after — the average return on investment is much better.

Another way to think about this: On average, the direct revenue collected from audits exceed costs by a factor of 2 to 1. But, that payoff varies by income. For money spent auditing the bottom half of taxpayers, the IRS only roughly broke even.

Meanwhile, the agency pulled in $3.18 for each dollar spent auditing the top 1 percent, and $6.29 for the top 0.1 percent.
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In the years after a taxpayer gets audited, they start paying much more in taxes voluntarily. Maybe, post-audit, they stop taking some dodgy deductions (counting a personal car as a business expense, for example). Or they start reporting income they had previously accepted off the books.
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These additional taxes equal about three times the revenue raised from the initial audit, on average, over the 14 years of data the researchers had access to. So in other words, the biggest returns from doing more audits come from deterrence effects.
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That multiplier — three times as much revenue from deterrence effects as from the initial audit — is relatively consistent across the income distribution, with both rich and poor adjusting their post-audit tax habits significantly. Which still means that in raw dollar terms auditing the rich has bigger payoffs.
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Consequences of the deal to claw back money from the IRS
So what do these numbers tell us about Congress’s decision to claw back money from the IRS? They suggest that existing projections for long-term costs likely underestimate the massive hole this policy will blow into federal budgets.
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Again, the authors instead find the opposite, that the long-term deterrence effects are huge, much larger than the upfront bounty that comes from the audits themselves.
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For every additional dollar spent auditing people in the top decile of the income distribution, the government can expect to get 12 times that amount back.

Twelve! As any tax-dodging billionaire can attest: It’s pretty hard to beat that return on investment.

In other words: If the IRS spends more money on audits, and those resources actually target high earners, the payoff could be enormous — far greater than has usually been assumed.
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Audits of millionaires (and megacorporations) have dramatically declined in recent years, according to data from Syracuse University’s Transactional Records Access Clearinghouse.

Certainly Republicans have fearmongered that the IRS will devote all its new money to deploying “armies” of gun-toting IRS agents to hound honest, middle-class taxpayers. So what evidence do we have that the agency will pursue higher-earning, higher-ROI tax-shirkers instead?

For one, President Biden, Treasury Secretary Janet L. Yellen and others have pledged to raise audit rates only on households earning more than $400,000 (which is close to the top percentile, in this study’s data). Two, the agency is now equipped with better information about how to spend its dollars most efficiently, thanks to this new research.

“The evidence suggests going after higher-income taxpayers has higher returns, and that’s reassuring given the recent policy focus on auditing wealthy individuals,” says Ben Sprung-Keyser, one of the study’s co-authors
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In any case, the revenue Congress just agreed to leave on the table by rescinding $20 billion from IRS’s long-term budget could be substantial. Based on that 12 to 1 multiplier found in this study for marginal returns from auditing high earners, that could mean Congress just gave up about $240 billion in revenue, for a net cost to the budget of $220 billion ($240 billion - $20 billion cut from IRS budget = $220 billion).

So much for trying to reduce deficits."

The GOP couldn't care less about average Americans. They say they want to fix the debt, but really just want to stop any programs that don't benefit the wealthiest. Who has benefitted the most in the U.S. over the last few decades, the wealthiest. They can most afford additional taxes. Yet the GOP is not interested in even thinking about that.

Nothing could make it clearer that they are the party of the rich and don't govern for the country as a whole, but only for their obscenely wealthy donors. The obscenely wealthy and their puppets, the GOP, are all so selfish, no society could function for long if they were in charge or the majority. They are parasites who aren't even remotely interested in what is good for the majority of the country.

Republicans Literally Laugh Off Idea of Taxing the Rich to Fix Budget | The New Republic https://newrepublic.com/post/172782/republicans-literally-laugh-off-idea-taxing-rich-fix-budget

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#GOPInBedWithTheRich
#GOPIsTheBitchOfTheRich

"Republicans have said they want to reduce government spending and increase U.S. revenue—but not if it inconveniences rich people, apparently.

When a reporter asked House Speaker Kevin McCarthy if he would consider raising taxes on wealthy Americans, he answered with a short “No” before the question was even finished. Republicans standing around him groaned and shook their heads. They then began laughing when McCarthy asked where the reporter was earlier.

McCarthy explained that wealth taxes weren’t necessary because the United States has a revenue of 20 percent of gross domestic product, as opposed to 17 percent in previous years. Instead, inflation was due to the Democrats spending $6 trillion after winning the presidential election in 2020.

McCarthy’s statement about revenue is technically true: The U.S. revenues in 2022 totaled 19.6 percent of GDP, according to the Congressional Budget Office, compared to the annual average of 17.4 percent in the five decades prior. Most of that revenue comes from income taxes.

But raising taxes on the wealthy, even by a little bit, would produce huge amounts of revenue. In 2021, Senators Elizabeth Warren and Bernie Sanders proposed charging billionaires a 3 percent wealth tax, and households and trusts worth between $50 million and $1 billion a tax of just 2 percent per year.

This would only apply to a tiny fraction of Americans, but it could produce about $3 trillion in revenue over the next decade, University of Berkeley economists predicted.

In his budget, President Joe Biden proposed increasing taxes on wealthy Americans and corporations and using the revenue to expand health care, childcare assistance, and housing aid. Not only have Republicans fought this plan, but their own budget proposes punishing lower-income Americans to benefit the wealthy.

Republicans’ solution to the debt ceiling crisis is focused on mere pennies in comparison to what a wealth tax would do. The bill calls for work requirements for Medicaid, food stamps, and cash assistance programs—which would barely make a dent in U.S. debt. Work requirements would save the government only about $1 billion per year, according to the CBO, nowhere near how much actually needs to be recouped. And that’s assuming, of course, that such requirements actually work.

The U.S. is just weeks away from defaulting on its debt, but Republicans and Democrats remain at a logjam over how to solve the problem. The GOP seems ready to take it out on the backs of people who can least afford it."