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Study shows rescinding IRS funding will increase the deficit by well over $100 billion

In a tweet posted last September, House Republicans promised that their first act as the majority party would be to rescind the $80 billion or so allocated by the Inflation Reduction Act so that the IRS could hire 87,000 more agents. Marc Goldwein of the Committee for a Responsible Federal Budget, says a CBO analysis shows that pulling that $80 billion would end up increasing the federal deficit by $114 billion over a decade. It would also encourage tax cheating, but we’re not sure how it would do that, considering the Biden administration has promised us those 87,000 new employees would be tasked with IT support and answering taxpayer questions, not auditing someone who earned $600 on Etsy.

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The CRFB writes:

The House is likely to vote today on a bill that would rescind roughly $70 billion of Internal Revenue Service (IRS) funding over the next decade. According to the Congressional Budget Office (CBO), the bill would increase deficits by more than $100 billion over the next decade while encouraging tax cheating, expanding the tax gap, and undermining a policy supported by every President since Ronald Reagan, including Donald Trump.

Last year, the Inflation Reduction Act appropriated roughly $80 billion to the IRS to expand operational support, modernize systems, improve customer service, and strengthen tax enforcement. According to recent estimates, 13 percent of taxes owed are never paid – mainly because of underreported income and overreported deductions and credits. CBO estimated the new IRS funding would improve compliance modestly, generating about $180 billion of revenue through 2031.

We were going to say it, but this guy already did: The CBO also said President Joe Biden’s cancelation of student loans would cost $400 billion.

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How will the new agents “strengthen enforcement” if they’re just there to answer taxpayer questions?

How about making a tax return that fits on a postcard?

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Don’t just rescind the funding, eliminate the IRS entirely. We don’t trust anyone cheering for a larger IRS.

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Editor’s Note:
 
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