Economic indicators show that the labor market is experiencing a period of rising wages and more job choices for workers as Americans continue to recover from the economic effects of the COVID-19 pandemic. Research indicates that the scale of the impact of government programs like Unemployment Insurance (UI) on the timing of workers’ return to work is small to negligible. Real-time evidence and broad academic consensus suggest that the labor market is returning to its pre-pandemic tightness, countering claims by proponents of a “labor shortage.” Before the pandemic, wages were rising and workers had more choices for jobs that fit their skills and needs as the labor market tightened.
In April 2021, IRS Commissioner Charles Rettig estimated that the tax gap—the difference between the taxes that are owed and the taxes that are actually paid—“could approach and possibly exceed $1 trillion” each year.1 Commissioner Rettig attributed much of the growing tax gap to the lightly regulated cryptocurrency sector, foreign-source income and the abuse of passthrough provisions.2 As some taxpayers continuously develop ever more sophisticated methods of tax evasion, it has become increasingly difficult for the IRS to maintain strong enforcement efforts, particularly as its budget and staffing levels have been slashed in recent years.