Thread: If Trump wants to run the country like a business, he should expand the IRS

If Trump wants to run the country like a business, he should expand the IRS

Doyle McManus

If you’re still laboring over your tax forms to meet the April 18 filing deadline, here’s a comforting thought: Unless you made well over $1 million — and unless your financial life is as complicated as, say, Donald Trump’s — your chances of being audited are getting ever closer to zero.

The Internal Revenue Service says it will process 152 million individual tax returns this year; only about a million returns will trigger an audit. That’s roughly two-thirds of 1%, the lowest rate in more than a decade.

There’s a simple reason for that decline: Since 2010, Congress has reduced the tax agency’s budget by roughly 17% in real dollars.

Spending on tax enforcement, including audits, has been cut even more deeply — almost 30%.

As a result, the federal government is losing at least $7 billion in revenue each year, according to tax expert William G. Gale of the Brookings Institution.

A smart businessman would look at those numbers and say: That’s nuts.

Every additional dollar spent on tax enforcement will produce at least $6 in revenue. That’s a return on investment any businessman would love.


That’s what Steven Mnuchin, the Los Angeles banker who became Trump’s treasury secretary, concluded when he took his first look at the IRS.

“I was particularly surprised … that the IRS headcount has gone down quite dramatically,” Mnuchin told senators at his confirmation hearing. “Especially for an agency that collects revenues, this is something that I'm concerned about.”

A stronger IRS, Mnuchin said, could reduce the federal budget deficit by closing the “tax gap,” the more than $450 billion difference between what the federal government is owed and what it actually collects.

“This is one of the areas where I think we will all agree: to the extent we add resources, we can collect more money,” he said.

And he was sure the president, another hardheaded businessman, would agree. “We add people and we make money — he'll get that completely. That's a very quick conversation with Donald Trump.”

That was before Mnuchin collided with Mick Mulvaney, Trump’s new budget director.

Mulvaney, a former member of Congress, was a leader of the House Freedom Caucus, many of whose members say they’d like to abolish the IRS entirely. Mulvaney and his colleagues have been working to cut the IRS budget for years.

A few weeks after Mnuchin’s testimony, Mulvaney released Trump’s first-draft budget proposal. It proposed cutting $239 million from the IRS.

Mulvaney hasn’t explained why he chose that number; most of the media attention went to programs that were being slashed even more deeply, including the State Department and social services.

But he gave a clue to his thinking last year, when he co-sponsored a bill to impeach IRS Commissioner John Koskinen, ostensibly for failing to cooperate with congressional investigations.

“Who’s going to come rushing to the defense of the IRS?” Mulvaney said then.

It would be hard to find a clearer collision between the two cultures of the Trump administration: the pragmatists like Mnuchin, many of them former Democrats, who came to Washington to run the federal government more like a business — and conservative hard-liners like Mulvaney, who want to shrink the federal government more than they want to run it.

If Trump is thinking clearly about the wrenching changes he’s seeking in the federal budget — large-scale tax cuts, domestic spending cuts, and a big increase in defense spending — he’ll listen to Mnuchin’s argument about revenue.

The IRS and outside experts estimate that every additional dollar spent on tax enforcement will produce at least $6 in revenue. That’s a return on investment any businessman would love.

There’s another reason Trump should want to spend more money on tax enforcement: civic virtue.

“Americans see taxpaying … as a civic duty and a moral obligation,” argues political scientist Vanessa Williamson, author of “Read My Lips,” a new book on public attitudes about taxes. “Even for very conservative Americans, being a taxpayer is shorthand for being an upstanding, contributing citizen.”

Americans pay their taxes voluntarily at a rate higher than many other nationalities, she notes. The reason, she said, is something economists call “tax morale” — “the social norm that we share, that if everyone else is chipping in I should do my part too.”

A recent Pew Research poll found that 71% of Americans think not reporting all your income is “morally wrong.” That included 78% of Republicans — and only 68% of Democrats.

What does the IRS enforcement budget have to do with tax morale? If fewer returns are audited, tax experts fear the social norm in favor of honesty will erode — the same way police believe broken windows wear down the sense of order in an urban neighborhood.

If the system is not viewed as fair, overall compliance rates are going to drop,” Koskinen said. “If someone paying their fair share of taxes sees others who don’t, and those others get away with it, that taxpayer may be a lot less motivated.”

So, President Trump, as you broker this debate between your treasury secretary and your budget director, remember what you promised: that you’d run the federal government more like a business. The revenue side is a good place to start. Better tax enforcement will help your bottom line. It would even be good for the nation’s morale.

http://www.latimes.com/opinion/op-ed...412-story.html

If you ran it like a business, you'd support the FairTax, abolish the IRS, and pay Retailers and States a 1/2% combined fee to collect the FairTax.

FairTax Act of 2017:

HR 25 in the US House of Representatives and S 18 in the US Senate.

No legislation has ever made more common sense with greater results for the American People than this legislation. Support it now. Urge immediate passage by Congress and get this beautiful show of fixing our country on the road.

Originally Posted by Judy

If you ran it like a business, you'd support the FairTax, abolish the IRS, and pay Retailers and States a 1/2% to collect the FairTax.

FairTax Act of 2017:

HR 25 in the US House of Representatives and S 18 in the US Senate.

No legislation has ever made more common sense with greater results for the American People than this legislation. Support it now. Urge immediate passage by Congress and get this beautiful show of fixing our country on the road.

http://www.fairtaxfraud.com/fallout.asp

The income tax is a fraud against a free people of a free nation. The income tax is a fraud against our beloved Constitution, a scam against freedom, and a curse on liberty. The income tax is a fraudulent conspiracy against the citizens of the United States and everything we stand for. It's the core of the evil exploited by Globalists to redistribute wealth, to cause grievous indebtedness to foreign countries, to manipulate our dollar, strangle our economy and impoverish the American Worker with the consequences.

The income tax is and has been the single greatest non-military threat to the well-being of the United States and the American People of any single act by anyone from anywhere. It is the Number One Enemy Within.

Judy
our Friend from PA her son .was our of a job ' for 6 year's told you you about this
be for our new President Trump get in now her son has a job now & new store are back . trump know just what he is doing . & judy all your post are very good .
South Bx

Originally Posted by southBronx

Judy
our Friend from PA her son .was our of a job ' for 6 year's told you you about this
be for our new President Trump get in now her son has a job now & new store are back . trump know just what he is doing . & judy all your post are very good .
South Bx

Oh thank you so much, South Bx, and I am so thrilled to hear about your friend's son having a new job and the new stores coming back! Yes, our dear Donald J Trump knows exactly what he's doing! So glad to hear from, and I hope all is well with you and your family, SouthBronx!! Your posts always cheer me up.

Thank you judy your the best Happy Easter to you & every One

SouthBronx

Oh and a wonderful and Happy Easter to you, too, SouthBronx!!!

Some other form of taxation would be good - maybe any would be better than the one we have.

We need a tax system that extracts taxes from everyone. Everyone needs to share in the pain, here.

Just no prebates. No more government strings on us.

My experience with audits - 5 years in a row - is they lie and they threaten. You have to know what you are doing and be willing to stand toe to toe with them.

There are plenty of people, organizations, that need auditing in this country - but they seldom go after them.

Heck, they can't even seem to match 1099's to filed tax returns.

That's what the FairTax does, nntrixie. It extracts from everyone who spends money n the United States. It can't get any better than that. Visitors and tourists pay. Illegal aliens pay. Immigrants pay. Citizens pay. Everyone pays when they buy new goods and services at the final point of sale. It taxes happy, voluntary consumption instead of production, the way it ought to be. The FairTax legislation is around 132 pages of law versus 77,000 pages of IRS law. Individuals don't have to do anything, except voluntarily shop and pay. Retailers have to send in 23% once a month on their state sales tax form. They don't even have to have a separate form. The states add 2 or 3 lines to their existing state sales tax form. The retailers deduct a fee for the service of collecting it, 1/4% or $200 whichever is greater and the states collect a 1/4% fee for their service in collecting it from the retailers and sending it in to the feds. The feds get 50 state reports and 50 transmittals a month. The states basically enforce it to collect their own tax and their fee for the FairTax. So instead of an IRS staff of over 100,000 employees, you'd have a group of 10 or so reviewing the 50 reports, answering questions. For the 5 states that don't have a state income tax, they can either establish a staff to collect the FairTax, hire a neighboring state that does to do it for them, or the Feds will set up a staff in that state to do it for them. It's all laid out in the legislation.

We'd save most of $14 billion a year just in abolishing the IRS. Americans would save over $300 billion in lost productivity and direct expenses associated with compliance with the income tax. The FairTax robustly funds SS and Medicare, and more than amply funds the US government. It will jump-start the economy, create millions of jobs, protect our trade (imports sold in US are taxed the same as domestic products), penalize illegal aliens (have to pay when they shop but are ineligible for the Rebate), and restores liberty and privacy to the lives and businesses of the American people.

If people don't like the Rebate, I'm good with eliminating it and reducing the FairTax rate from 23% to 20%. The purpose of the Rebate is to exempt essential spending from the tax the same as the personal and dependent deductions do now on the income tax for US citizens and legal permanent residents. Illegal aliens, tourists and short term visitors are not eligible for the Rebate. It's voluntary to sign up. I understand why it's in there and for its purpose, it's brilliant, but if people don't like it, I'm good with getting rid of it and reducing the rate accordingly.

FairTax Act of 2017: HR 25 in the US House of Representatives and S 18 in the US Senate.