They're the people who make sure everyone pays their taxes. If you owe, you owe. Doesn;t matter if it's a million from a billionaire, or 2,000 from a low wage worker
To be precise they are the people selectively monitoring and diligently enforcing compliance to the tax code. The tax code, the law, and the constitutional decrees on taxation themselves are what defines who should owe what tax- though the judicial interpretation of congresses constitutional legal boundaries for setting tax code create an environment where it is a noted fact that the tax code can be used beyond simply the scope of collecting taxes to generate revenue or in creating a truly equal and uniform tax structure.
As far as the ability to “tax the rich,” reducing the budget of the IRS could theoretically increase their ability to do so, or in conjunction with political and administrative pressure create the ground work for a system which allows for a greater ability to “tax the rich.” It seems counter intuitive- but if the IRS budget were cut and in response we were to simplify the tax code- remove many complex loopholes and exceptions etc. and go to a simpler tax or even a system where based on income reporting and assets the IRS simply sends a person a tax bill or refund amount instead of having to process hundreds of millions of potentially complex forms with accompanying documentation etc. an algorithm calculates tax based off what was earned, what was gained or maintained, and everyone just gets a slip saying “pay this much” or “we will send you a check for this much..” and that would largely be the end of the situation unless the assets reported were wrong, then an agent would be…
.. necessary, or an automated system as a first tier and an agent as the second- to handle disputes on what is owned or earned as well or issues such as property that was or wasn’t accounted for etc.
It’s more complex than I make it sound of course- but it isn’t really as complicated as our present system and would also allow better collection of taxes from “rich people” and corporate entities who would no longer be able to use classic strategies for shielding wealth and assets from taxation.
Often budget cuts can lead to increased efficiencies in organizations, although there are practical limits.
It is also worth noting that the IRS does more than “tax the rich” or just “tax stuff.” IRS agents were responsible for the breaking up of one of the largest online child sex busts of recent history for example. Tax issues or odd financial transactions can often be an effect of other types of crime because these crimes can generate large profits and modern crimes often aren’t conducted purely as “cash” transactions; and at the “head” of such crimes it’s impractical for most people to keep millions of dollars in cash “under their mattress.” So the electronic records and banking or other records of the storage and transfer of that money is out there- deeds to properties bought to “store” the money or bank deposits and so forth.
Since the money was gained illicitly, there aren’t generally “receipts” to show how a person came across these sums of money in a legitimate way. It looks suspicious and federal agents may notice or be alerted via tips and decide to investigate. By the same token, other law enforcement agencies often turn to the IRS when trying to find evidence or understand and trace criminal enterprise- especially large scale or digital crimes. Tax records are one physical record which any person or entity will generally have if they conduct commerce. Most people know it was taxes that brought down Al Capone when the FBI had trouble getting the evidence to prosecute him for mob activity. There are many examples of this- where ultimately if not a clue, IRS assistance provides the proof of some criminal activity which can be used to lock up criminals who otherwise covered their tracks “perfectly.”
So in that’s sense, I’d be more worried that cutting the IRS budget will have a negative impact on their ability to independent discover and investigate serious crimes and provide assistance to other law enforcement agencies in their own investigations. The scope of many IRS investigations and those requiring IRS assistance can often be massive international operations that can be years long and involve agencies around the world since crimes and money often cross borders.
The ability to provide fast and high quality service to those who may be “rich” but are more likely “average” people who have been audited or experienced errors or other issues is more concerning to me than the IRS not being able to tax “the rich” as these peoples lives can be fundamentally upended by unresolved or ongoing issues with the IRS.
It’s more complex than I make it sound of course- but it isn’t really as complicated as our present system and would also allow better collection of taxes from “rich people” and corporate entities who would no longer be able to use classic strategies for shielding wealth and assets from taxation.
Often budget cuts can lead to increased efficiencies in organizations, although there are practical limits.
The ability to provide fast and high quality service to those who may be “rich” but are more likely “average” people who have been audited or experienced errors or other issues is more concerning to me than the IRS not being able to tax “the rich” as these peoples lives can be fundamentally upended by unresolved or ongoing issues with the IRS.