Paul Rothstein, Relax Your Jaw, 4 May 2009
The President announced an initiative on taxes today. It had all the inspiration of day-old soda. He wants to limit various kinds of profit shifting that allow US multinationals (I know, that’s a confusing concept) to avoid US taxes. By some estimates, the plan could raise $21 billion in each of the next ten years.
Ho hum!
In 2005, the IRS estimated that the 2001 tax gap was — wait for it — $345 billion, of which about $55 was ultimately collected. Most of this money was from under-reporting by individuals, including significant under-reporting of individual business income.