Security & Fraud

Guess How Much Tax Evasion Costs US Taxpayers?

Taxes

The Internal Revenue Service has estimated that the business of tax evasion is a costly one for the government. Tax cheats cost the government as much as $458 billion annually, according to data tabulated between 2008 and 2010. The latest numbers mean that the cheating has become costlier, at least slightly, as previous tabulations came up with estimates of about $450 billion annually, in numbers issued in 2006.

The rise in that “tax gap,” according to the Feds, may be due to better measurement rather than fraud actually getting worse. And the IRS has stated that it expects to recover about $52 billion of that aforementioned $458 billion. In addition, the voluntary compliance rate, which is a measure of how taxes owed compare with taxes paid in full and on time, should reach nearly 82 percent.

As has been widely reported, the agency itself has been knee-deep in the process of working its way through both budget and staffing cuts, with the IRS stating that those cuts have been a hurdle to boosting both service and maximizing revenue to the government entity itself. As noted by Fortune, public awareness over tax evasion has been heightened. One exacerbating factor has been that the publication of the “Panama Papers” — leaked documents from a Panamanian law firm — has shown how offshore companies, some of them formed in the United States, have been created to help shelter money away from the IRS.

——————————–

Featured PYMNTS Study: 

With eyes on lowering costs to improving cash flow, 85 percent of U.S. firms plan to make real-time payments integral to their operations within three years. However, some firms still feel technical barriers stand in the way. In the January 2020 Making Real-Time Payments A Reality Study, PYMNTS surveyed more than 500 financial executives to examine what it will take to channel RTP interest into real-world adoption. Here’s what we learned.

Click to comment

TRENDING RIGHT NOW