According to a recent report from the Treasury Inspector General for Tax Administration, the Internal Revenue Service has lost nearly a third of its revenue agents in only two months. Since the start of the second Trump administration, the IRS has seen massive and unprecedented workforce reductions, the rapid erosion of long-standing data security and privacy protections, and the shift of decision-making power from civil servants to political appointees.

Similar actions are underway across the federal government—but because the IRS raises about 96 percent of all federal revenue, these cuts to the tax agency threaten the capacity of the U.S. government as a whole. The potential damage to federal revenue has been estimated in the hundreds of billions or even trillions of dollars over the decade to come.

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The magnitude of these staff reductions is without comparison in the modern history of the IRS. The nadir of the IRS’s effectiveness came in the late 2010s, when chronic underfunding forced the agency to reduce its workforce by an average of 2 percent annually, about one-sixth of the reduction seen so far this year. And the cuts are still coming. Leaked information suggests that administration officials are aiming to reduce the agency’s workforce by 25, 40, or 50 percent in total. Roughly 20,000 IRS employees have reportedly applied for the second round of deferred resignation, offered by the Treasury Department in April; if approved, these separations, plus the terminations that have already occurred, would represent almost one-third of the agency’s workforce.

In addition to dismantling the IRS’s civil rights and anti-discrimination functions, the Trump administration is seeking a weaker tax enforcement system. Under one plan disclosed in March, taxpayer services were slated to see an 8 percent decline in workforce, while compliance was due to be cut by 22 percent by mid-May. Workforce cuts have been particularly severe in the portions of the IRS that enforce tax law for the highest earners. The IRS office investigating pass-through entities, an abuse-prone business structure given preferential treatment in the 2017 Tax Cuts and Jobs Act, had lost 27 percent of its workforce by late March. The Global High Wealth unit, which investigates the personal and business taxes of the very richest people, was until recently slated for major expansion. It has instead lost 38 percent of its staff. The staffing reductions have interrupted ongoing audits on high earners, many of which will likely expire without reaching their conclusion.

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If we look at the longer scope of American history, the co-occurrence of democratic erosion and a decline in tax capacity comes as no surprise at all. The people who have sought to undermine the U.S. government’s fiscal capacity have consistently been America’s anti-democratic forces. Like the three-fifths clause that distorted representation, the tax limitations in the U.S. Constitution were intended to protect slavery. Slaveholders feared that even a government chosen only by propertied white men might use the tax power to bring about abolition. Similarly, the Jim Crow governments of the American South developed supermajority requirements to prevent the taxation of property, a policy that worked hand in hand with voter suppression: Even if the biracial working-class majority somehow regained power, they would still not be able to tax the rich. Undermining tax administration is a standard component of reactionary politics in America.

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