Catherine Rempel writes that the Republican Party is rebranding itself:
Once upon a time, Republicans portrayed themselves as the party of small government and family values. Recently, though, GOP leaders have been cobbling together a new coalition, welcoming insurrectionists, white-nationalist tiki-torchers and people who think Bill Gates is trying to microchip them.
Now they're welcoming tax cheats into their tent:
Here’s the backstory. Each year, about $600 billion in taxes legally owed are not paid. For scale, that’s roughly equal to all federal income taxes paid by the lowest-earning 90 percent of taxpayers, according to Treasury Department data.
These unpaid taxes — often called the “tax gap” — are predominantly owed by wealthy individuals. The richest 1 percent alone duck an estimated $163 billion in income taxes each year.
To be clear, rank-and-file wage-earners are not necessarily more honest or patriotic. It’s just much harder for them to shortchange Uncle Sam.
Working stiffs have taxes deducted from their biweekly or monthly cheques:
And, critically, most labor-related income — as well as income from dividends, interest and other sources — gets reported to the Internal Revenue Service through W-2s, 1099s and other common tax documents.
But the wealthy operate differently:
There are some types of income, however, for which little or no third-party reporting exists. These income categories — including partnership, proprietorship and rental income — accrue disproportionately to high earners. The government has much less ability to tell when these filers are misreporting; as a result, they can more easily get away with cheating.
This is evident from IRS data on “voluntary compliance,” or how accurately people report their income and tax liabilities without the government having to come after them. When it comes to ordinary wage and salary income, taxpayers are remarkably forthcoming, with noncompliance averaging only 1 percent; for those more “opaque” income sources, noncompliance is an estimated 55 percent.
Not all high-income people (or people with rental or partnership or other “opaque” income) are cheating, of course. A more effective response would involve more of that third-party reporting so the IRS has greater visibility into who’s likely fudging their numbers. Then the agency could better target its audit decisions.
More reporting would also deter would-be tax cheats from fudging in the first place, because they’d know they’re more likely to get caught.
This solution is exactly what Democrats have proposed as part of their big budget bill.
But guess who's opposed to that -- and who's supporting Republicans? The rich don't get rich by helping poor people.