The richest 1% are already responsible for nearly 30% of all unpaid taxes—amounting to $205 billion annually. That’s $562 million in unpaid taxes per day, or $6,500 every second.
Ahead of Tax Day, Oxfam, the global organization fighting inequality to end poverty and injustice, released a new issue brief detailing how the Trump administration’s attempts to undermine the Internal Revenue Service (IRS) are further rigging the tax code in favor of billionaires and mega-corporations. According to Oxfam, President Trump and Elon Musk’s plan to halve the IRS workforce would allow ultra-rich tax cheats to effectively steal an additional $30 million every day—or $110 billion over the next decade—through unlawful tax evasion.
“While the rest of us dutifully file our taxes, ultra-wealthy tax cheats drain over a half a billion a day from the public coffers,” said Rebecca Riddell, Oxfam America’s Senior Policy Lead for Economic and Racial Justice. “By seeking to gut the IRS, President Trump and Elon Musk would make it harder to fight poverty but even easier for the very richest taxpayers to avoid paying what they owe. This would undoubtedly be great for billionaire tax cheats but bad for everyone else.”
The brief lays out how massive proposed cuts to the IRS workforce would ultimately result in the transfer of wealth upwards, exacerbating the effects of an already-unfair tax code that contributes to skyrocketing wealth concentration and perpetuates economic inequality, especially along lines of race and gender. The richest 1 percent are already responsible for nearly 30 percent of unpaid taxes, reports the Yale Budget Lab, amounting to $205 billion in unpaid taxes annually ($562 million in unpaid taxes per day or $6,500 every second).
The Trump-Musk administration has initiated an all-out assault on the agency by planning to fire as many as 50,000 IRS employees—essentially halving the workforce. This move, along with recent reductions in enforcement funding, would make it even easier for the ultra-wealthy to avoid paying what they owe because there will be far fewer workers and resources to enforce the tax code. Gutting the IRS is also more likely to concentrate enforcement on lower-income, disproportionately Black households, largely because doing so is less resource-intensive. Meanwhile, the richest 400 individuals in the U.S. pay an effective federal income tax of just 8.2%, substantially lower than middle-class workers like teachers and nurses.
A well-funded IRS can help reduce inequality in two main ways:
- Ensure ultra-wealthy tax cheats pay their fair share: According to one recent study, every $1 spent auditing the top 0.1% yields $6.29 in direct revenue, with total returns likely far higher due to greater deterrence. For example, in less than one year, increased enforcement funds from the Inflation Reduction Act allowed the IRS to recover more than $1 billion in past-due taxes from ultra-wealthy tax cheats.
- Reduce poverty: The IRS is also a critical public service that can help taxpayers access vital income support. Much of the social safety net in the U.S. operates through the tax code, with tax programs like the Earned Income Tax Credit and Child Tax Credit lifting millions out of poverty. IRS programs like Direct File not only help low-income families avoid expensive filing fees, but can also help close the tax credit coverage gap, delivering billions in vital income support to eligible families.
Oxfam supports an inequality-reducing tax code that makes the ultra-rich, Wall Street, and corporations pay their fair share—and advances racial, gender, and climate justice. Congress should not only invest in the IRS, but also reject efforts to make ordinary people pay for tax handouts to the ultra-rich. With many regressive Tax Cuts and Jobs Act provisions expiring this year, now is the time to reshape the tax code so that it prioritizes workers and families.
Oxfam is a global organization that fights inequality to end poverty and injustice. We offer lifesaving support in times of crisis and advocate for economic justice, gender equality, and climate action. We demand equal rights and equal treatment so that everyone can thrive, not just survive. The future is equal. Join us at oxfamamerica.org.
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Notes to editors:
Read the issue brief on IRS cuts here.
Methodology: Cost estimates for the impact of IRS cuts and the distributional analysis of unpaid taxes are from the Yale Budget Lab’s March 2025 report, The Revenue and Distributional Effects of IRS Funding. To derive figures for how IRS cuts would impact tax evasion by the wealthy, we multiplied the estimated gross revenue loss by the top income percentile’s share of unpaid taxes (28%). The Yale Budget Lab estimated that a 50,000-employee reduction in force would lead to $394.6 billion in gross revenue lost over 10 years. Twenty-eight percent of $394.6 billion is $110.49 billion, representing the top income percentile’s contribution to this lost revenue.
Oxfam America supports an inequality-reducing tax code and calls on Congress to reject tax giveaways for the wealthiest and large corporations.
Read Oxfam’s reaction to DOGE’s IRS layoffs here.
When accounting for increases in net worth, one study found that the richest 400 individuals in the U.S. pay an effective federal income tax rate of just 8.2%.
In less than one year, increased enforcement funds from the Inflation Reduction Act allowed the Internal Revenue Service (IRS) to recover more than $1 billion in past-due taxes from wealthy tax cheats.
Researchers have found that $1 spent auditing the richest 0.1% of taxpayers yields more than $6 in revenue.