Larry Summers Warns Trump's IRS Cuts Could Cost Americans $1 Trillion Over 10 Years, Calls Strategy 'Raw Incompetence'

Former Treasury Secretary Larry Summers has expressed concern that President Donald Trump‘s cuts to the Internal Revenue Service (IRS) could lead to a loss of $1 trillion for the government.

What Happened: Summers expressed his worries when he appeared on Wall Street Week on Bloomberg Television. He predicted that the government might suffer a large loss over the course of the next ten years as a result of Trump’s “attack” on the IRS as part of his ambitious cost-cutting plan.

Trump’s budget cuts include a 75% cut to the IRS’s Office of Civil Rights and Compliance, which handles accusations of discrimination against taxpayers. Since Trump took office, the IRS has also had several leadership changes, including five different acting commissioners since January.

See Also: IRS Leadership Shakeup Following Clash With Elon Musk

Why It Matters: Summers, who worked in the administration of former President Bill Clinton, called Trump’s strategy “raw incompetence,” putting the foundation of the tax system at risk.

Significant changes have been occurring at the IRS throughout the Trump administration. Commerce Secretary Howard Lutnick reaffirmed Trump’s call to abolish the IRS in February.

The IRS anticipates a $500 billion revenue deficit as a result of workforce reductions and payment avoidance.

In April, Trump reversed the appointment of the IRS interim head, reportedly influenced by Tesla Inc. CEO Elon Musk, following objections from Treasury Secretary Scott Bessent.

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