IRS chief says U.S. annual 'tax gap' may exceed $1 trillion

FILE PHOTO: Internal Revenue Service Commissioner Charles Rettig testifies on his agency’s budget before a House Appropriations Subcommittee hearing on Capitol Hill in Washington, U.S., April 9, 2019. REUTERS/Aaron P. Bernstein/File Photo

WASHINGTON (Reuters) – The U.S. Internal Revenue Service needs more and consistent funding to help close a “tax gap” that is leaving perhaps more than $1 trillion in legally owed taxes uncollected every year, IRS Commissioner Charles Rettig said on Tuesday.

Rettig told the Senate Finance Committee that new sources of wealth have arisen since 2011-2013, when the last official annual tax gap estimate of $441 billion was made, including cryptocurrencies and the rising use of complex, foreign-source income.

“If you add those in, I think it would not be outlandish, that the actual tax cap could approach, and possibly exceed $1 trillion” on an annual basis, Rettig said.

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