The Tax Code Has the IRS Understaffed, Not a Tight Budget

By April 15th, all American taxpayers should have filed their taxes with the Internal Revenue Service. This year, two issues gained prominence in the filing process.

First, this year’s tax returns included a new section addressing the individual health care mandate created in the Patient Protection and Affordable Care Act.

Second, between budget cuts and internal issues, the IRS claims it is woefully understaffed and underfunded, making it difficult for the agency to complete its statutory duties with respect to revenue collection.

In reality, both problems are the result of an overly burdensome tax code that makes compliance difficult, with excessively high administrative costs. The most effective solution requires a fundamental rethinking of tax policy, with an eye toward revamping today’s tax code and making it simpler, fairer,and flatter.