Treasury recovers $1.3B in unpaid taxes from high-wealth tax dodgers
apnews.com
apnews.com
There is an estimated 1.4 billion acres of private property. At an *average* of $10,000 per acre, that would raise 14 Trillion Dollars in revenue. Split 50/50 with the States, 7 Trillion to the Federal Government and 7 Trillion divided between the States proportionally, that would cover nearly all government spending.
The Federal budget for 2023 was 6.1 Trillion Dollars, including a 1.4 Trillion Deficit. 7 Trillion covers that with hundreds of billions left over to start making debt payments.
Now the vast plurality of this land is farm land so at 10,000 an acre would be an onerous burden. So we would probably not get to that average and still need additional revenue or otherwise not be able to abolish all other taxes.
I'm a left-wing debt hawk, and I really have no answer to the current unsustainable freight train of debt. I suspect inflation is the current plan, but we really, really have slowly building problem that will eventually cascade. When I does, I only hope that I'm invested in an anti-fragile position.
But this would be a direct tax and require a constitutional amendment like the 16th to implement. It really isn’t happening.
But without something radical like the single tax, we will need to increase taxes and implement austerity to deal with the deficit and debt.
The problem is that land value has become completely disassociated with value. You could get rid of all income taxes, and by adding a land value tax, effectively half the homeowners in CA wouldn't be able to afford the taxes on their own property. Is that bad policy in CA? Sure, it definitely is, but it is the policy, and it would unleash a major short-term crisis.
A common way high net worth people end up delinquent is that they had a windfall like selling a business or appreciated property which they managed poorly or which was genuinely complicated (e.g. due to international issues), resulting in a temporary liquidity problem or just uncertainty over what they needed to pay.
Particularly with the low interest rates historically it was just no big deal to be a bit delinquent while you work things out or solve your liquidity... but still be on track to eventually pay it.
I wouldn't be too surprised if a careful analysis showed most of this recovery was already expected based on historical behavior and that if there was any excess higher interest rates were the main driver.
No bad thing surely? Take the easy wins where you can get them and then go after the harder stuff.
news flash, folks, every billionaire in the USA, combined, has a combined net worth of about 5 trillion dollars. making billionaires not exist by confiscating all of their wealth (and crashing the stock market in the process) would fund the government for around nine months.
not saying that the ultra-wealthy shouldn't pay their fair share, but we only have 2 real choices: dramatically cut spending and/or dramatically increase productivity/gdp. raising taxes is just window dressing and mostly just hurts people who have a w2 income.
Is that an argument for me to not pay my taxes?
> (and crashing the stock market in the process)
Some scaremongering there for a straw man's argument that you made up.
Put thieves, tax avoidance is theft, into prison. Getting the money back is not enough. Society needs justice, and people stealing from everybody should not only pay their fair share but also be punished when they steal from society.
https://www.statista.com/chart/28393/us-public-debt/
I think it's indisputable that tax policy has an impact on a government's health.
Yes, that's not exactly the same thing as prosecutable tax avoidance. But my sense is the real problem here is quasi-legal tax avoidance, and that this small $1.3 billion figure is just hinting at how easily more taxes could be recovered with less lenient tax policies. (As well as better-funded enforcement officers...) But that gets dangerously close to also saying, "let's raise the tax rates on millionaires (not just billionaires) back to where it was a few years ago..."
And let's be honest: that's why we're having this discussion. Government spending is bad and part of the problem, according to one side - with taxes just a way of enabling it. There's been a lot of words devoted to extolling the values of lower taxes in creating jobs and innovation.
So I think at some point, people just start rooting for tax avoidance.
If all that money is spend the receivers pay taxes and spend the rest and that receivers also pay taxes and spend the rest and so on and on.
All these tax money is once again spend and the circle continues.
Economy is about flow not sum.
This is why high tax countries have terrible GDP. Unless a good part of the tax goes to subsidize companies in some way. And subsidies are very hard to do right and most likely bring corruption into government.
Many low tax countries have terrible GDP too, so it's not the tax.
And businesses needs customers. More middle class customers support more businesses than few billionaires.
If you spread the wealth it benefits the economy and helps creating new businesses.
Companies like Airbnb, Uber, Netflix etc. don't satisfy a need of billionaires.
So you either can hope a billionaire founds a useful company or give wealth back to the people and let the market do the choosing.
Many goverment expenses come from corruption, from expensive payments for health care (that exists because billionaires put money into politicians pockets, to overspending in the military that also come from kickbacks, etc.). So, reducing the numbers of billionaires reduces corruption and overspending. (And even what is spend can be done so more efficiently, money going to teachers and nurses instead of profits for big corporations).
Cutting on corruption has a big impact into goverment spending. Billionaires and inequality increase corruption, as there is easy money used to bribe politicians. End one and the other follows.
VI. Conclusions and Implications
In summary, income inequality is likely to be a significant and no less important determinant of corruption than economic development (and thus many other variables for that matter). ... Inequality increases corruption, which in turn deters investment and growth.
Have you looked at any other data besides this article? I haven't which is why I'm not jumping to wild conclusions.
Also their budget has been declining continuously since ~2010. It think it might recover it's (inflation adjusted) 2009 level this year.
OTH it's significantly more effective at collecting taxes than it was back in the 90s or 00s (cost per $ collected is 20-30% lower than it used to be) so extra funding might not necessarily make a huge difference. Then again regardless it's not like the government can done anything better with the extra money.
Also:
https://www.taxpolicycenter.org/sites/default/files/wp-conte...
No, I think it was $5667 billion. Where do people come up with this nonsense? Did you even check what their annual budget was?
Also the IRS budget was still lower in 2023 than it was back in 2009 (inflation adjusted) and has been declining continuously until ~2020.
Because they are only supposed to get that much over the following 10 years.
And they already lost 25% of that:https://www.grantthornton.com/insights/newsletters/tax/2024/...
Their total budget in 2023 was $16 billion and it's generally not increased (or it's even cut) yearly.
So it's not keeping up with inflation and GDP growth without additional funding like the "Inflation Reduction"(since everyone knows that you can reduce inflation by spending even more money..) Act.
The chart on the right. Year is the bottom axis and the vertical axis shows the budget. When the curve goes down it means that the budget has decreased from a higher amount to a lower one (before you say it.. I never claimed it happened every year).
I would also suggest you that you look up figures from before 2014 because that's when most of the cuts happened.
When criminals see that they get caught for evading taxes then many of them reduce their activity. Dissuasion is also part of the equation.
If we do the math this is 13000 per tax payer or about 2.5 k per year.
So these high net worth individuals attempting to evade taxes owed... 2500 dollars each year.
To me that signals that they're likely not residents or making their money in America and had tax liability for some marginal reason. That's the only way you owe 2.5 k per year on a high income.
But yes, when you do the math, it does seem a little ridiculous. I pay a lot more in federal taxes.
Either IRS failed to collect the full amount owed, of these were people caught in some bizarre technicality where they owed chump change to the government and didn't know.
1. Why am I hearing this?
2. Why am I hearing this NOW?
Try to drop your pre-existing beliefs about the topic for a moment (rich people bad, FedBots evil, etc) and ask why this attempt at persuasion has been brought to your attention.
Who benefits from the agitation that occur in your mind when you read this?
You're hearing current reporting on the current results of recent funding increases.
You didn't hear this a year, two years, or five years ago .. because it hadn't happened yet.
It's not that deep a mystery.
My own secular belief system is in shared contribution to the cost and support of civilization. If I alone pay, that is insufficient. We must all pay what is due for the system to effectively function.