The Internal Revenue Service (IRS) has lost out on up to USD58bn worth of taxes because of businesses who have failed to forward payments withheld from the wages of their employees to the government over the past ten years, congressional investigators have revealed this week.
The Government Accountability Office, in a report published this week, revealed that more than one and a half million businesses owed the supposedly withheld income, Social Security and Medicare taxes as at the end of September last year.
Because the taxes weren't paid,
the government had to cover shortfalls in Social
Security and Medicare from its funds, the GAO stated.
The GAO report argued that the Internal Revenue Service had relied too much on voluntary
compliance.
According to the Washington Post, Senator Norm Coleman (Minn.), the ranking Republican on the Senate Homeland Security and Governmental Affairs Committee's Permanent Subcommittee on Investigations, which requested the report, called on the IRS "to take off the kid gloves" when dealing with such businesses, with Senator Carl M. Levin, subcommittee chairman, agreeing:
"At a time when our nation is drowning in debt, it is appalling that delinquent businesses have cheated Uncle Sam," Levin observed.
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