Former White House chief of staff John Kelly’s recent revelations that President Donald Trump wanted a number of his political enemies to be investigated by the Internal Revenue Service shouldn’t surprise or shock. Trump’s attempt to politicize the IRS is yet another chilling example of how democracy can be undermined by the abuse of power.
Former US Supreme Court Justice Oliver Wendell Holmes Jr. wisely observed that “taxation is the price we pay for a civilized society.” Our system of taxation — a system upon which our national defense, border security, highway and airline safety, and so many other things that protect and enhance our quality of life — is dependent upon voluntary compliance with the tax laws, which means that taxpayers need to trust that the system is fair and honest. If taxpayers come to distrust the IRS or believe that it is politically motivated, voluntary compliance erodes and honest taxpayers — the vast majority of whom have their taxes withheld from their paychecks and who are rarely audited — end up picking up the tab for the difference through higher taxes. The result: Evaders are subsidized by those who play by the rules.
The Treasury Department estimates that this difference — the so-called federal “tax gap” — exceeds $550 billion every year. Tax evasion is not a victimless crime.
The temptation to abuse the tax system for partisan or political gain isn’t new. Many recall President Nixon’s invidious plans to target his political enemies and his creation of the sinister-sounding IRS Special Services Staff, or SSS, to pursue them. Earlier administrations were reportedly tempted to leverage the IRS to settle scores and to exact punishment on — or silence — opponents, including civil rights leaders like Martin Luther King, as well as journalists.
Here in Massachusetts in the early 1980s, attempts to use our state tax agency for political gain led to widespread investigations, indictments, and the tragic suicide of the second-highest-ranking administrator in the Department of Revenue. When Mike Dukakis, a reform candidate, was returned to office as the result of the 1982 election, I was charged, as the new commissioner of revenue, with restoring public confidence in the integrity of the department.
Our innovative strategy of “honest, fair, and firm” tax administration, of treating taxpayers as customers rather than victims, of reestablishing morale and modernizing a demoralized agency all played major roles in restoring public confidence in the integrity of the department. The result: increased voluntary compliance, tax collections exceeding anyone’s projections, and the avoidance of contemplated tax increases.
Trump’s alleged desire to use the IRS to target his perceived enemies isn’t the only recent example of demagogic rhetoric and dangerous actions threatening to undermine public confidence in one of the indispensable institutions of our democracy. Defunding, defaming, and denigrating the IRS, as so many Republicans seek to do, is a sure way to further erode public confidence and to portray the government as corrupt and the system as rigged. Along with election denial and efforts to suppress the vote, the deliberate efforts to distort the facts and to portray the IRS as the enemy of the people is cynical, wrong, and deeply alarming.
As citizens, we have few affirmative obligations other than to file and pay our taxes. There is simply no place for politics in our system of tax administration. We need to remain vigilant to ensure that the IRS and the 50 state departments of revenue are bastions of integrity, efficiency, and service.
Tax administration is one of those processes that affect virtually every American citizen and where we all have a vested interest in preserving independence, impartiality, and professionalism.
Ira A. Jackson was Massachusetts Commissioner of Revenue from 1983 to 1987. He is a cofounder of the Civic Action Project and teaches a course on leadership at Harvard College.