The IRS is entering into an agmt to share data about undocumented immigrants with ICE. Historically, the agency promised data would not be used in this way.
We estimate the govt will lose ~$300B in the next decade as a result.
Why? Today, undocumented immigrants pay about $66B in federal taxes, w/ about 2/3 as payroll taxes.
As a result of this agreement, this population will worry about tax data being weaponized – and could stop filing taxes and/or shift to work arrangements that won’t withhold.
Hard to know how much of a loss this will be. @The_Budget_Lab has a range depending on scope of behavioral adjustment: between ~$150B-$480B over the next decade.