Here comes the barrage of misleading tax evasion “news.”

If you don’t think news stories are contrived and planted, consider all this just at a time when some politicians are pushing higher taxes and a new wealth taxes.

Note the use of “evade” by the NYTs and “fail to pay.” The fact is this is based on a news story written by a Treasury official and former academic. The number thrown about comes from academic research. Also note the press headlines focus on the $160 billion, but not the other $440 billion.

“September 7, 2021

By Natasha Sarin, Deputy Assistant 0Secretary for Economic Policy

A well-functioning tax system requires that everyone pays the taxes they owe. Today, the “tax gap”—the difference between taxes that are owed and collected—totals around $600 billion annually and will mean approximately $7 trillion of lost tax revenue over the next decade. The sheer magnitude of lost revenue is striking: it is equal to 3 percent of GDP, or all the income taxes paid by the lowest earning 90 percent of taxpayers.”

The tax gap can be a major source of inequity. Today’s tax code contains two sets of rules: one for regular wage and salary workers who report virtually all the income they earn; and another for wealthy taxpayers, who are often able to avoid a large share of the taxes they owe. As Table 1 demonstrates, estimates from academic researchers suggest that more than $160 billion lost annually is from taxes that top 1 percent choose not to pay.


The statement “two sets of rules” is the clue to the purpose of this research and story.

There are not two sets of rules. The difference is that wage and salary workers pay most of their taxes through payroll withholding and those not earning their income that way follow thousands of pages of rules and regulations and private letter rulings, which, of course, actually apply to all taxpayers in the same circumstances.

To be accurate she should have said there are four sets of rules. Three for salary workers, small businesses that deal largely in cash and workers who are paid in cash and, if you like, wealthy taxpayers who are mostly entrepreneurs and investors.

As an aside, the IRS estimates that waiters and waitresses underreport their tips by 84%. Or is that “choose not to pay.”

Is there tax evasion and fraud, of course. Does every taxpayer seek to pay the least amount of taxes possible, certainly. But also consider that underpaying taxes also results from not understanding the incredibly complex law and simple errors.

None of what is being reported is new information. Lost revenue of hundreds of billions of dollars a year has been reported for years. By the way, IRS statistics show the biggest tax evaders are individuals not corporations.

What you see now is a coordinated campaign to convince Americans a wealth tax and higher taxes on 1/2% of Americans and corporations is justified and “fair🤮” It’s propaganda, pure and simple.


  1. I’m shocked, shocked! In an oversimplified nutshell, “news” has been replaced by news as entertainment. This helps to explain a lot.


  2. A hit piece using 7 year old data to increase the size of government. One would think that if all this was true, that the IRS would be focusing their audits and enforcement efforts where they would get the most bang for the investigative buck.
    Also, I’ll bet that most of these “evaders” are just following the tax law and using the loopholes that Congress wrote in to the tax laws.


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