Former Treasury Secretary Larry Summers warns that Trump's drastic IRS cuts may cost the government $1 trillion over the next decade. Summers criticizes these measures as a 'misguided attack' threatening tax compliance. He notes significant staff reductions at the IRS, compounded by ongoing leadership instability. Yale economist Natasha Sarin argues that this estimate is likely conservative, suggesting potential losses could exceed $2 trillion, highlighting a large gap between owed and collected taxes, with an estimated $700 billion uncollected this year.
"I'd be surprised if we're not on a path to sacrificing more than $1 trillion of revenue over the next decade because of this misguided, wanton attack on the IRS," Summers said.
"The reality is that we have a very large gap in this country between taxes that are owed and taxes that are collected," Sarin said, estimating that this year there will be about $700 billion in taxes.
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