February 14, 2023
The Honorable Ron Wyden
Senate Committee on Finance
219 Dirksen Senate Office Building
Washington, D.C. 20510
Dear Chairman Wyden:
We are writing on behalf of Americans for Tax Fairness—a coalition of over 450 organizations dedicated to creating a fairer tax system—to urge the speedy confirmation of Danny Werfel as Commissioner of Internal Revenue. He is the leader the Internal Revenue Service needs at this promising but challenging moment in its history, previously served as Acting IRS Commissioner, and deserves the Senate’s support.
Years of intentional underinvestment have hobbled the IRS’s customer service while giving wealthy and corporate tax cheats a free ride—since 2010 annual appropriations funding and personnel are down by 20%, and audit rates declined 58% overall between 2010 and 2019, with rates among large corporations declining 54% and those for millionaires dropping by 71%.
The IRS was finally given the resources it needs to reverse this decline in last year’s Inflation Reduction Act (IRA). The IRA will invest nearly $80 billion to improve tax enforcement and customer service, which the Congressional Budget Office estimates will increase federal revenues by $180 billion over the next decade by catching and deterring tax evasion, reducing the deficit by about $100 billion. This investment includes: $45.6 billion for enforcement, $25.3 billion for operations support, $4.8 billion for systems modernization, and $3.2 billion for taxpayer services.
This restored enforcement funding is critical to close the “tax gap”—the difference between what’s owed and what’s paid—the Treasury Department estimates the “gross tax gap” at $540 billion per year, a good portion of it made up of unpaid taxes of the rich and large corporations. Other parts of the funding package are imperative for improving customer service for honest taxpayers: as of this past December, around 10 million returns sat unprocessed (an improvement over 2021, but still a big number) and in 2021 nine out of ten phone calls to the IRS went unanswered.
But this long-overdue restoration of adequate IRS personnel and technology also requires strong and competent management, starting at the top. Mr. Werfel is uniquely well-suited to provide the necessary level of executive leadership.
First, he served in this position before, as Acting IRS Commissioner in 2013. This will allow him to get up to speed with his responsibilities faster and better than anyone new to the job. Second, he has extensive federal financial-management experience having worked for over a decade at the Office of Management and Budget (OMB), including as deputy controller and acting controller. Third, he has served in both Democratic and Republican administrations. Mr. Werfel was promoted within the OMB under the George W. Bush and the Barack Obama administrations. His bipartisan credentials will help him work effectively with a politically divided Congress and defend the IRA’s investment in rebuilding the IRS.
Only a Senate-confirmed commissioner has the clout to move the IRS forward on its two urgent goals of improving customer service for honest taxpayers—answering phones, processing returns, issuing refunds—and cracking down on tax avoidance by the wealthy and large profitable corporations, who deprive Americans of hundreds of billions of dollars in unpaid tax revenue each year. That’s why it’s imperative that his nomination move quickly through the Senate with your wholehearted backing.
Alliance for Retired Americans
American Family Voices
American Federation of State, County and Municipal Employees (AFSCME)
American Federation of Teachers (AFT)
Americans for Democratic Action
Americans for Tax Fairness
Asian Pacific American Labor Alliance, AFL-CIO
Campaign for America’s Future
Center for American Progress
Center for Common Ground
Center for Law and Social Policy (CLASP)
Center for Popular Democracy
Coalition on Human Needs
Communications Workers of America (CWA)
Community Change Action
Economic Policy Institute
Friends of the Earth
Healthcare For America Now
Health Care Voter
ICNA Council for Social Justice
Institute on Taxation and Economic Policy
Jean-Michel Cousteau’s Ocean Futures Society
Main Street Alliance
National Education Association (NEA)
National Employment Law Project
National Organization for Women
NETWORK Lobby for Catholic Social Justice
Pride at Work
Service Employees International Union (SEIU)
Small Business Majority
Strong Economy for All Coalition
Unitarian Universalists for Social Justice
United for a Fair Economy
United Steelworkers (USW)
Unrig Our Economy
Working Families Party