Bridging the Tax Gap: The Case for Increasing the IRS Budget

Publication Date: January 2008

Publisher: OMB Watch (Organization : U.S.)

Author(s):

Research Area: Banking and finance

Keywords: tax gap; irs

Type: Report

Abstract:

A significant and pernicious problem facing the nation is the tax gap, the difference between what is owed in taxes and what is paid. Estimated to be over $300 billion annually, the tax gap represents an enormous revenue loss for the government. This lack of revenue often causes unnecessary increases in annual deficits and the national debt, increasing national interest payments and adding pressure to cut vital government services. Unfortunately, much of the gap must be made up eventually by honest taxpayers through higher taxes and by beneficiaries of federal investments through service cuts. Bridging the Tax Gap: The Case for Increasing the IRS Budget illustrates some of the factors that perpetuate the tax gap and offers practical solutions to the problem.