IRS chief says some $1T in taxes going uncollected annually.
The amount of taxes going uncollected by the federal government could be as much as $1 trillion or more per year, IRS Commissioner Chuck Rettig said Tuesday.
His estimate goes far beyond the official $441 billion difference between taxes paid and taxes owed annually, the so-called tax gap, reported by the IRS, which is based on figures from 2011-2013. The next official estimate will come out next year.
A confluence of factors suggest the tax-gap growth Rettig projected, including increased virtual currency holdings, which weren’t figured in the 2011-2013 period but now amount to more than $2 trillion worldwide, he said. In testimony before the Senate Finance Committee, Rettig also said counting foreign-source income and illegal-source income would increase the tab, too, and that IRS research indicates $175 billion in underpayments among the wealthiest Americans.
With all those reasons in mind, it wouldn’t be outlandish to think the tax gap “could approach and possibly exceed $1 trillion per year,” Rettig said.
h/t SG
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