The Biden administration is proposing hiring 87,000 new workers for the Internal Revenue Service (IRS), effectively doubling the agency’s size, as part of a plan to beef up enforcement efforts and find billions of dollars in tax revenues that go uncollected each year.
Enforcement efforts would primarily target individuals and corporations with higher incomes and profits, the administration has suggested.
The hiring, which would be part of President Joe Biden’s overall $80 billion spending plan to increase enforcement efforts at the IRS, would not happen all at once. Instead, it would be carried out in phases, with a 15 percent growth in employment at the agency per year until that 87,000 hiring benchmark is reached.
The move would help recoup (and go beyond) some of the employment losses the agency has seen over the past decade, as the IRS has lost more than 33,000 workers over the past decade. The drop in employment at the agency has resulted in fewer audits, particularly for filers with higher incomes.
If successful — and, if the IRS is able to step up its enforcement efforts — tax collectors may be able to generate an additional $700 billion over the next decade alone, the Biden administration has claimed, which could help pay for the president’s ambitious spending bills regarding infrastructure and aid to U.S. families.
The administration’s aim for greater IRS enforcement, and the net benefits that would come from it, has received support from Democrats in Congress.
Sen. Elizabeth Warren (D-Massachusetts) hailed the idea of increasing IRS enforcement earlier this week, noting that enforcement efforts over the past 10 years of staffing decreases at the agency have led to less frequent audits for the wealthy with more frequent audits for marginalized communities.
“The IRS is so starved for resources that it targets people who are cheapest to audit: low-income taxpayers, and often people of color,” she explained on Twitter.
Economists have said, however, that the IRS is missing out on potentially large sums of money by not going after wealthy tax dodgers instead. Research has found that the top 1 percent of tax dodgers avoid as much as $5 trillion over a decade.
Rep. Conor Lamb (D-Pennsylvania) also supported efforts to increase enforcement, as the current system disproportionately affects working-class families.
“Why should a pipefitter or teacher have to pay all their taxes, while big companies just evade the IRS? If we just enforce the law equally, the pipefitters and teachers will be treated equally and we’ll have money left over to fund infrastructure and schools,” Lamb said.
Republicans have for decades attempted to discredit the IRS, making it out to be a bogeyman to their base and anyone who would listen to them, resulting in drastic cuts to the agency over the years. Odd budget rules set by lawmakers in Congress in the past have also made it impossible to demonstrate, through the Congressional Budget Office’s published analyses, how much increased enforcement could actually help when it comes to issues like the debt or yearly deficit spending.
The right has already begun efforts to stop Biden’s plan for greater scrutiny of wealthier Americans’ tax filing. A political action committee called the Coalition to Protect American Workers, a GOP-aligned group with ties to former Vice President Mike Pence, has started running commercials aimed at garnering opposition to the White House’s plan, describing the hiring increases in one advertisement as an attempt to “recruit an army of IRS agents.”
But Republicans’ motives for running such ads might be selfish — many of them are part of the 1 percent themselves or receive donations from corporations that could be affected by IRS crackdowns, meaning that new enforcement rules might mean less money in the GOP’s own wallets.