1/ In Tax Notes today, former IRS Commissioner Charles Rossotti, @NatashaRSarin and I outline how the next Admin can collect more than $1 trillion in a highly progressive way:
Making people pay the taxes that they already owe.
taxnotes.com/featured-analy…
2/We've previously written independently on the need for a robust attack on the tax gap.

Here, we come together to lay out a roadmap for change, calling for more audits, tech improvements & third party reporting that will help IRS collect taxes due but unpaid, disprop by the $$$
3/ Our program would raise enough to fund important policy initiatives that will help those who need it most:
Could more than double the EITC or SNAP; or fund universal pre-K and paid leave programs.
4/ Will also make the tax code more efficient and fair: As @NickKRistof pointed, it is outrageous that today the IRS is more likely to audit taxpayers who live on the Mississippi Delta than Park Ave.
5/ But a gutted IRS simply doesn’t have resources it needs to go after the top—even though that’s where the unpaid taxes are.

Budget is down 15% in a decade, workforce is down 20%, highest drop for agents capable of high-income examinations.
6/This is why we all believe investment in the IRS is top priority for tax reform efforts.

Our hope is for legislation to give IRS resources it needs to rebuild workforce, overhaul outdated tech, and collect info from 3rd parties to cross-check returns.
7/ But much can also be accomplished on Day 1 in a new Admin.

For ex: Treasury can redirect existing resources toward $$ noncompliers; prioritize these cases and seek high penalties; sanction tax advisors who facilitate malfeasance; and use existing authority to hire IT talent.
8/ Investment in IRS, to signal an end to two-tiered tax system, is not where tax reform efforts should stop.
But seems a natural place to start, and an area where much good can be done early on through regs and creative exec action.

• • •

Missing some Tweet in this thread? You can try to force a refresh
 

Keep Current with Lawrence H. Summers

Lawrence H. Summers Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @LHSummers

30 Nov
Following the great appointment of Janet Yellen, the Biden Administration is assembling a super economic team. This group will be laser focused on middle class prosperity, inequality and discrimination and addressing climate change. They will make a big difference for America.
I have known Ceci Rouse since she was student of mine @Harvard in 80s. She is a deeply serious researcher in the economics of education & inequality. She stood out in the Obama Admin & has been a great Dean. Her integrity will be a big asset for the CEA, Pres Biden & our country.
My friend @neeratanden is a force of nature. Her strength as a communicator is exceeded only by the strength of her convictions. No one works harder, with more of a sense of purpose. She will bring new thinking about government budgeting to the OMB that this moment demands.
Read 5 tweets
20 Nov
1/During a financial crisis, ⁦@USTreasury⁩ Sec Paulson understood in transition it was his job to help the Fed and the incoming Admin establish a basis for strong, cooperative efforts to contain the crisis. Sec.Mnuchin has done just the opposite. wsj.com/articles/mnuch…
2/In these complex times, there is room for debate on what types of government intervention in credit markets are appropriate.

There's not much room for debate on the merits of maintaining stanbdy capacities.
3/ We cannot predict when or if a panicky cascade will happen in credit markets. Aftershocks after financial crises (and earthquakes) are not uncommon. Removing a capacity to respond as @stevenmnuchin1 has sought to do is wrong.
Read 4 tweets
18 Oct
Told @FareedZakaria on GPS @CNN, America’s failure on COVID-19 is almost unimaginable. Heck, if the U.S. had handled the pandemic as well as Pakistan, we would have saved in neighborhood of $10 trillion.
The costs of an expanded testing system are trivial compared to the costs of tens of thousands of early deaths. Expanding testing should be a matter of utmost urgency.
Interest rates are essentially zero, telling us that the funds are available and won’t crowd out anything important. Instead it will push economy forward. All the dangers are on spending too little, not too much.
Read 4 tweets
17 Oct
As I say in the story, @Harvard investment in @broadinstitute was one of the easiest decisions made during my time as President. In many ways you can measure it, Harvard’s investment in the Broad has been a spectacular success.
I don’t know any other philanthropists who have turned the same rigor, exacting standards and persistence that made them wealthy to their philanthropy in the way Eli Broad, supported by Edye’s shrewd human judgment, has done. @UnreasonableEli
Read 4 tweets
12 Oct
I have a Viewpoint out in JAMA with my colleague @Cutler_econ – The COVID-19 Pandemic and the $16 Trillion Virus. It is particularly relevant today ja.ma/3diC0U9
1/13
We estimate the cost of the COVID virus for the US. Bottom line cost: $16 trillion. This is $200,000 per family or 90% of a year’s GDP.
2/13
Some other metrics: this is 4x the output loss of the Great Recession, 2x the cost of all wars since 9/11, and roughly the cost of climate change in the next 50 years. Let me explain the estimates.
3/13
Read 13 tweets
12 Oct
Watch here my debate ⁦@fordschool⁩ with @MayaMacGuineas on whether the federal deficit is unsustainable. fordschool.umich.edu/events/2020/fe…
We need a different paradigm while thinking about the deficit. Of course we need more stimulus. The difficult question is: What do we need in the future?
A move to austerity as soon as possible is dangerous & misguided. Fails to appreciate the big structural changes in our economy, which is the emergence of a massive excess of private savings over private investments at a reasonable interest rate. What I call secular stagnation.
Read 6 tweets

Did Thread Reader help you today?

Support us! We are indie developers!


This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!

Follow Us on Twitter!