Under-Reported Income To IRS: World Poverty Will End Ten TimesMarch 28, 2013 4:06 am
$66 Billion is the number that is widely quoted as the amount required to end world poverty – this number comes from this report from Brookings Institution called ‘Poverty in Numbers: The Changing State of Global Poverty from 2005 to 2015’ – and technically, the number 66 billion USD is the amount required to provide every person in the world with a minimum income of $1.25/day — in other words guaranteeing the right not to live in absolute poverty (See Page 13 of the report).
We spotted this stat today, that the IRS has a ‘tax gap’ running into the hundreds of billions of dollars – some studies put the number at 600 billion dollars (even the official estimate is $385 billion as of 2006) (Source)
Where does this tax gap come from? The single biggest contributor to the tax gap — accounting for 84% of it — are people who simply under-report their income (Source)
You read that headline right – if the IRS could just somehow manage to collect these ‘Uncollectibles’, it could help end world poverty 10 times over. (Of course, this comparison is meant to digest the magnitude of the 600 billion tax gap stat that we spotted today)