To the editor:
The GOP fixation on tax cuts started with the Reagan administration’s make-the-rich-richer cuts (called Trickle Down) in the 1980s. The federal deficit and wealth inequality took off. When George Bush raised taxes in 1990 to slow the rising deficit, he was crucified by the GOP. Similar tax cuts, primarily beneficial for the wealthy, were enacted in the George Bush junior and Trump administrations. The deficit debt ballooned, and wealth inequality widened even further. The claim that the cuts would “pay for themselves” was proven ludicrous.
In the face of massive debt deficit and wealth inequality, the GOP is advocating even further tax cuts. Why is the GOP obsessed with crippling our federal services, already in chaos from arbitrary personnel firings? The public needs safe food, roads and bridges, air travel, clean air and water, national parks, VA care, protection against predatory finance, etc., etc. Tax revenue is the source to fund these things. Economic analysis shows the GOP proposed cuts would cut safety net programs (Medicare, Medicaid, and others). While the rich may not need these, the public does appreciate them.
It gets worse…we can’t even collect taxes that are owed. The Brookings Institution estimated annual deliberate or inadvertent tax evasion to be 75% of the federal budget deficit, with higher income households having the highest avoidance, in spite of the preferential tax treatment they’ve received. Other estimates are $500 billion to one trillion dollars annually in lost taxes. In other words, if taxes that were owed were paid, we wouldn’t have a budget deficit!
The only way to recover avoided taxes is through IRS enforcement action, but the GOP has relentlessly underfunded the IRS. This has resulted in lowering the frequency of audits for all taxpayers, in particular at high income levels. The US Treasury has estimated that the top 1% dodge $163 billion in taxes. High income individuals and large corporations have the advantage of employing sophisticated tax strategies. It takes time and expertise to challenge these through an audit, but these cannot be done without adequate funding.
The Biden administration appropriated $80 billion to improve IRS services and enforcement, but the GOP has managed to claw back over half of this funding with no intent of renewing it. Their current attack on the IRS is the unwarranted dismissal of 6000 IRS employees, with plans being drafted to slash up to half of IRS employees. The insanity of this action is obvious. In 2021 the Congressional Budget Office estimates that each $1 increase in IRS enforcement action results in a revenue increase of $5 to $9. A 2024 report from the Government Accountability Office estimated that every hour employees spent auditing the returns of wealthy taxpayers returned $13,000! There is simply no greater investment return we have possible than appropriately funding and staffing the IRS. Yet the GOP fights this tooth and nail.
Why does the GOP want to further cripple government services through additional tax cuts, and why do they want to shield the wealthy from paying the taxes that are owed?
Jim Hill
Hastings