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Warren Pushes for $3.5 Trillion Budget for Tax Cheats

Tax Cheats
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EDITOR NOTE: Elizabeth Warren, backed by her partner-in-crime, Bernie Sanders, wants to add provisions in the Democrats’ $3.5 trillion budget plan to turn the IRS into an attack dog to go after “wealthy tax cheats”. Her stated goal for better arming the IRS to plunder the “wealthy” is to “generate billions for the federal government.” This is just the latest example that shows how the U.S. government, as currently constituted, wants to take back wealth from anyone they deem to have more than they deserve. It is the No. 1 argument for purchasing non-CUSIP gold and silver that Warren’s IRS on steroids can’t seize when they come for your possessions.

Three U.S. senators, led by Massachusetts progressive Elizabeth Warren, on Tuesday called for the Democrats’ sweeping $3.5 trillion budget plan to include money to help the Internal Revenue Service beef up its tax enforcement.

In a letter to IRS Commissioner Charles Rettig, which was viewed by CNBC, the senators called on the agency to demonstrate how better enforcement could help generate billions for the federal government in owed taxes.

Warren and the letter’s co-signers underscored the importance of restoring the tax collector’s budget as a way to hold wealthy Americans who flaunt the U.S. tax code accountable. The letter comes as Democrats jockey to include favored provisions in a yet-to-be-defined budget reconciliation package.

Warren, who was joined by Sens. Bernie Sanders, I-Vt., and Sheldon Whitehouse, D-R.I., wrote that revitalizing the IRS budget would allow it to “go after wealthy tax cheats and provide faster and better service to the majority of Americans who are paying their fair share.”

“For too long, the wealthiest Americans have been able to use a raft of accountants, tax strategists, financial advisors, lawyers, and lobbyists to avoid paying their fair share in taxes,” the senators added. “The top 1% of Americans fail to report more than a fifth of their income on their tax returns, and they account for more than a third of all unpaid federal income tax.”

Specifically, Warren, Sanders and Whitehouse urged Rettig to answer a litany of questions designed to show how incremental congressional funding would help the IRS better enforce the tax code.

Warren and other progressive Democrats are incensed over the ever-widening tax gap — the difference between taxes owed to the IRS and the taxes actually paid, viewed by many as a proxy for tax avoidance.

The Treasury Department, which oversees the IRS, estimates that gap will balloon to $7 trillion over the next decade. The department did not immediately respond to CNBC’s request for comment.

Deputy Assistant Secretary Mark Mazur told lawmakers in June that the yawning gap is thanks to a 20% cut to the IRS budget over the last decade.

That reduction has led to a raft of staff layoffs and a swoon in audit rates. The IRS said earlier this year that budget reductions forced it to cut 33,378 full-time positions between fiscal 2010 and 2020, including a significant number of taxpayer service and enforcement personnel.

“It would not be outlandish to believe that the actual tax gap could approach, and possibly exceed, $1 trillion per year,” Rettig told the Senate Finance Committee in April.

Warren told Rettig on Tuesday that it’s critical Democrats include additional IRS funding in the $3.5 trillion budget resolution the party is attempting to muscle through Congress without Republican support.

The trio of Warren, Sanders and Whitehouse blasted Senate Republicans for reneging on an earlier agreement to include $40 billion in funding for the IRS as part of the bipartisan infrastructure bill that cleared the chamber Tuesday. 

That infrastructure bill, which passed the Senate 69-30, will allocate an additional $550 billion for transportation, broadband and utilities.

Sen. Rob Portman, a key Republican negotiator, said in July that the GOP abandoned its commitment to the funding after learning that Democrats were also planning to add a bigger IRS enforcement proposal to the separate, $3.5 trillion reconciliation spending package.

“It is now more important than ever that we include investments in the IRS and fair tax enforcement,” Warren concluded Tuesday. Corporate lobbyists who benefit from a weaker IRS “will continue to claim, falsely, that these proposals will somehow harm law-abiding taxpayers, when really their concern is that the IRS will have the tools to combat the complex tax schemes of wealthy and corporate tax cheats.”

The Senate began voting on amendments for the spending plan immediately after it passed the infrastructure bill.

Original post from CNBC

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