Unpaid Taxes Lead to Higher National Debt - 5/16/16
Part of the reason that the national debt continues to rise in America is that many fail to pay the government taxes they owe. It is estimated that each year, nearly four hundred and sixty billion in taxes that are owed are not paid – that’s according to the latest estimated from the Internal Revenue Service and it’s based on data from the two thousand and eight to twenty ten period.
To put that amount of money into perspective, it represents roughly three quarters of the current year’s projected budget deficit. As reported by CNNMoney, the IRS indicates that it manages to recapture about fifty two billion of that money through tax enforcement efforts like audits, which brings the annual tax payment gap to a bit more than four hundred billion dollars.
This seems remarkable given that Americans have a great reputation internationally for paying their taxes. The U.S. is associated with a voluntary compliance rate of eight two percent. The IRS cites three reasons for the large tax payment gap – underreporting, underpayment and failure to file in that order.
Tax filers who underreport what they owe account for three hundred and eighty seven billion dollars of the tax payment gap. It’s not always about deception. People make mistakes and are often confused by America’s complicated tax code.