Summary List PlacementMore wealthy Americans should be audited on a regular basis, Sen. Elizabeth Warren said Tuesday, telling Bloomberg she wants to double the IRS budget to do just that.
“The audit rate of the top one-tenth of 1% — the 100,000 families that would be affected — the audit rate will be 30%,” the Massachusetts Democrat said. “That means every three years, in effect.”
Warren made the case for more IRS auditors as part of her pitch for a 2-3% annual tax on the wealth of America’s ultra-rich. As Insider reported, her proposal calls for a $100 billion investment in IRS enforcement and a statutory requirement that no less than 3 in 10 people subject to the “ultra-millionaire tax,” on fortunes greater than $50 million, be audited each year.
Those worth more than $50 million would also be hit with a 40% “exit tax” should they try to evade the tax by renouncing their US citizenship.
As ProPublica has reported, the IRS has in recent years audited people earning less than $20,000 a year almost as often as those in the top 1%. In part, that’s because it’s easier to audit the poor: generally, they cannot afford lawyers and the savviest tax professionals.
Since 2010, the Associated Press noted, the IRS budget has also been slashed by some 20%, with nearly a third of its workforce expected to retire by the end of 2025.
As a result of that depletion, according to IRS data reviewed by ProPublica, millionaires were 80% less likely to be audited in 2018 than they were in 2011; just over 1.5% of the top 1% were audited at all.
Polling has suggested Warren’s wealth tax is broadly popular. First proposed when she was campaigning for president, in 2019 Fox News found that two-thirds of voters supported the idea.
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