Elizabeth Warren says the ultra-rich should be audited every 3 years

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Felipe Castro holds a sign advertising a tax preparation office for people that still need help completing their taxes before the Internal Revenue Service deadline on April 14, 2010 in Miami, Florida. Joe Raedle/Getty Images
  • US Sen. Elizabeth Warren wants to double the IRS budget, she told Bloomberg on Tuesday.
  • The money would pay for increased auditing of the ultra-rich, she said.
  • “The audit rate of the top one tenth of 1%… will be 30%. That means every three years, in effect,” Warren said.
  • Visit the Business section of Insider for more stories.

More wealthy Americans should be audited on a regular basis, Sen. Elizabeth Warren said Tuesday, telling Bloomberg she wants to double the IRS budget to do just that.

“The audit rate of the top one-tenth of 1% – the 100,000 families that would be affected – the audit rate will be 30%,” the Massachusetts Democrat said. “That means every three years, in effect.”

Warren made the case for more IRS auditors as part of her pitch for a 2-3% annual tax on the wealth of America’s ultra-rich. As Insider reported, her proposal calls for a $US100 ($128) billion investment in IRS enforcement and a statutory requirement that no less than 3 in 10 people subject to the “ultra-millionaire tax,” on fortunes greater than $US50 ($64) million, be audited each year.

Those worth more than $US50 ($64) million would also be hit with a 40% “exit tax” should they try to evade the tax by renouncing their US citizenship.

As ProPublica has reported, the IRS has in recent years audited people earning less than $US20,000 ($25,643) a year almost as often as those in the top 1%. In part, that’s because it’s easier to audit the poor: generally, they cannot afford lawyers and the savviest tax professionals.

Since 2010, the Associated Press noted, the IRS budget has also been slashed by some 20%, with nearly a third of its workforce expected to retire by the end of 2025.

As a result of that depletion, according to IRS data reviewed by ProPublica, millionaires were 80% less likely to be audited in 2018 than they were in 2011; just over 1.5% of the top 1% were audited at all.

Polling has suggested Warren’s wealth tax is broadly popular. First proposed when she was campaigning for president, in 2019 Fox News found that two-thirds of voters supported the idea.

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