The top 1% of American earners evade about $163 billion in taxes every year, researchers at the Treasury Department said in apublished Wednesday. That counts for roughly 28% of the total US tax gap, a measurement of taxes owed compared to taxes collected. The total gap is about $600 billion on a yearly basis and will cost the government $7 trillion in lost revenue over the next decade, the department said.
Top earners' evasion easily outpaces the next wealthiest Americans. Those in the 95th to 99th income percentile skip out on $144 billion in tax payments annually, according to the report. That counts for 24.7% of the nationwide tax gap.Much of the disparity is driven by wealthy Americans' ability to shield themselves from tax payments. Higher-income taxpayers can tap accountants, tax preparers, and other services to lower their true tax liability.
That practice is helping fuel economic inequality across the country, the department said. By exacerbating the tax gap, wealthy Americans force lawmakers to chose between higher budget deficits or tax hikes to pay for social programs. Both options are historically unpopular and tend to keep Congress from beefing up key support like unemployment benefits, food stamps, and infrastructure spending.
The Biden administration has a plan to stop the tax gap at the source. Convincing Congress to act, however, remains a tough battle.The White House seeks to strengthen tax enforcement to offset some of the cost of its $3.5 trillion infrastructure proposal. Treasury estimates that Biden's proposed
What does 'dodge' mean? Is it using the tax code to reduce taxes? Isn't that what every American mortgage holder does, including many Business Insider journalists?
Fake News
The piece is basically incoherent. If the methodology used to avoid taxation is legal then the result is not tax evasion and increased enforcement will not collect a dime.
this is terrible news
+ IRS cannot afford to audit them. IRS primarily audits the poor and middle class. It’s embarrassing and shortsighted.