What happens when the tables are turned, and the watchdogs seemingly protect the wrong side? Picture this: a world where the wealthy, adorned with their intricate tax returns, saunter away from the discerning eyes of the Internal Revenue Service (IRS), while low-income families find themselves audited at an unprecedented rate. That was America during Donald Trump’s tenure.
According to a revealing analysis by Americans for Tax Fairness (ATF), the IRS, under Trump, audited low-income families at a higher rate than millionaires for the first time. A staggering observation that makes one wonder – how did we get here?
Years of systematic budget cuts by the Republicans have left the IRS gasping for breath, understaffed, and inadequately resourced to scrutinize the complicated tax returns of the affluent class. Consequently, ATF discloses a jaw-dropping 92% drop in audits of millionaires over the last decade, enabling over a million wealthy Americans to dodge nearly $66 billion in federal taxes in recent years, per IRS data.
While audits of Earned Income Tax Credit (EITC) recipients have also decreased in the past decade, the contrast is strikingly less dramatic. The wealthy in the U.S., receiving a sixth of the nation’s total household income, are audited less than 1% of the time. The question inevitably arises – is justice being served or being starved?
The Democrats, led by President Joe Biden, attempted to rectify this imbalance, pumping an $80 billion budget increase into the IRS over the next decade. This financial infusion aimed to replenish the agency’s staffing, elevate customer service, and recover millions of delinquent tax dollars from affluent Americans. But the Republicans, unwavering in their stance, have sought to reverse this budget augmentation while concurrently sparking fears of IRS agents targeting everyday citizens.
The audacity of House Republicans to propose $67 billion in IRS cuts is not merely a budgetary stance but an impediment to the agency’s ability to hold wealthy tax evaders accountable. It feels like a sequel to a haunting narrative where “extreme MAGA Republicans” seem more keen on offering their wealthy benefactors a free pass at tax evasion than ensuring the government remains operational.
ATF’s David Kass doesn’t mince words, highlighting how the Republicans are demanding a carte blanche for their affluent donors to circumvent taxes as a condition for keeping the government functional. Ironically, just as the IRS, rejuvenated by the restored funding from the Inflation Reduction Act, begins to see results from its enhanced enforcement on wealthy and corporate tax scofflaws, House Republicans seek to turn back time.
The sagging enforcement of tax compliance isn’t just limited to individuals. Mega-corporations have revelled in the IRS’s underfunding. Audits of corporations boasting over $1 billion of income have plunged by 87% in the past decade, reaching an all-time low, while those with over $100 million of income have seen a decline of 91% in audits.
With the pendulum of tax enforcement seemingly swinging in favor of the affluent, one must ponder: In a nation already grappling with economic disparities, how does such a backward audit strategy affect the common citizen? The working-class American, observing the rich slip through the IRS’s net while they face heightened scrutiny, is left disillusioned. A country where the wealthy are cloaked in immunity while the poor are audited mercilessly is surely sailing away from the shores of fairness and equity.
In this skewed scenario, a collective demand for accountability and transparency becomes not just a cry of the marginalized but a requirement for justice, parity, and ensuring that the scales are balanced once again. The stories of the audited low-income families should serve as a reminder: the real thief isn’t always the one who is being chased. Sometimes, it’s the one who is allowed to walk away, unscrutinized.
