Tax collection is one of the many government functions likely to be affected by the upcoming Republican “trifecta” (control of the presidency, U.S. Senate and U.S. House). The Inflation Reduction Act secured nearly $80 billion for the IRS to increase compliance rates, upgrade technology and make new hires through 2031. But Republicans have repeatedly called for “clawing back” these funds. In addition, President-Elect Trump has promised to reduce employees in agencies such as the IRS. Trump has also proposed replacing tax revenue with foreign tariffs. However, many economists say foreign tariffs would raise prices for U.S. consumers and wouldn’t replace tax revenue.
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