Us Senator Elizabeth Warren unveiled a bill on Monday proposing to nearly triple the IRS (IRS) 's annual mandatory budget to $31.5 billion from the $11.9 billion approved by Congress this fiscal year to help the agency step up enforcement and crack down on tax evasion by the rich.
Warren's proposal would propose that the agency's funds be removed from the annual funding process so that the amount does not change as a result of the whims of Congress year after year.
"strengthening the IRS's ability to crack down on wealthy tax fraudsters requires not only more money, but also more stable money," Warren said. Mandatory allocations will provide funding on a sustained basis to ensure that the IRS budget is stable, predictable and sustainable-money that cannot be easily taken away by lobbyists. "
The money will help the agency enforce tax laws, upgrade its IT system, which dates back to the 1960s, and improve taxpayer services. In recent years, the agency has struggled to meet the basic needs of taxpayers, answering only about 2 per cent of the IRS tax filing helpline this spring.
Yellen, the US Treasury secretary, said earlier this month that the federal government could collect as much as $7tn in unpaid taxes over the past decade and that further action was needed to collect the money from the wealthiest Americans.
A recent study by IRS researchers and scholars found that the richest 1 per cent of Americans underreported 1/4 of their income to the IRS. For the top 0.1 per cent, underreported income is almost double that of the richest 1 per cent.
Overall, the number of IRS personnel working on complex tax evasion enforcement has fallen by 35% over the past decade, according to the U.S. Treasury Department.
The IRS budget fell by 20 per cent between 2010 and 2018, while audits fell by 42 per cent between 2010 and 2017. From 2011 to 2018, the audit rate of people earning more than $1 million a year fell by 80 per cent, according to a White House briefing.