Wednesday, July 2, 2014

Under-funding the IRS, then complaining about its failures

Thanks to Ralph Nader for an article on his blog highlighting this problem for the IRS.   At the same time that Darrell Issa is making life hell for IRS Commissioner John Koskinen -- insulting him  in hearings and allowing committee member Paul Ryan to accuse him of lying, without submitting evidence to back it up --the Republicans in the House are refusing to give the IRS a budget that allows them to properly do their job.

The annual budget for the whole IRS operation has been cut to $11.3 billion.   For such a large agency with such an important job, that is a paltry sum.   They have to process every tax return, both individual and corporate, which is somewhere over 100,000,000 returns.  They also have to conduct time-consuming audits of some of them;  and some of those wind up being taken to court for very expensive trials.  

In addition to those routine costs, you can probably subtract that .3 billion -- at least -- as the amount Issa has cost the IRS in time lost by IRS employees in order to produce all the documents (hundreds of thousands) his committee has demanded.

Not only that, but Commissioner Koskinen has tried to present evidence that, for every $1 its budget is increased, the IRS can recover $6 in taxes that are being evaded, many through questionable loopholes used by corporations and wealthy people with smart tax lawyers.  In other words, increasing the IRS budget would pay for itself 6 times over in unpaid taxes they are able to recover.

Koskinen says:  "I say that and everybody shrugs and goes on about their business.  I have not figured out either philosophically or psychologically why nobody seems to care whether we collect the revenue or not."

Of course, if the IRS does anything that can be twisted into a political football, Issa and his ilk milk it for all it's worth.   Like "Obamacare" and "amnesty for illegal immigrants" and "death panels," Republicans have succeeded in turning "IRS" into a viciously hated term.   The fact is, with its reduced budget, you are less likely to be audited by the IRS than at any time in recent history.

But why do I persist in trying to find the logic where there is none?

Ralph

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