DOGE Proposes 20% IRS Workforce Cut to Reduce National Debt

The Department of Government Efficiency (DOGE), under the leadership of businessman Elon Musk, has proposed a significant reduction in the Internal Revenue Service’s (IRS) workforce by 20%. This proposal, if implemented, would result in the termination of approximately 6,800 employees. This move comes in addition to the 6,700 probationary employees who have already been let go and the 4,700 IRS agents who were given severance packages to retire. The proposed cuts are expected to take effect by May 15, 2025.

The rationale behind these cuts is part of a broader strategy by DOGE to reduce the $36 trillion US national debt by streamlining the federal bureaucracy and implementing cost-cutting measures. One of the proposed measures includes putting all public spending onchain to enhance transparency and reduce deficits. This initiative aligns with President Trump's comprehensive tax reform plans, which include potentially eliminating the federal income tax and funding the federal government through tariffs on foreign goods.

However, the proposed layoffs face potential obstacles. A recent ruling by US district judge William Alsup has ordered federal agencies to reinstate probationary workers terminated due to DOGE's cost-cutting programs. This ruling could hinder the layoffs if the order is not overturned. The impact of this ruling remains to be seen, as it could significantly affect the timeline and scope of the proposed workforce reduction.

DOGE's cost-cutting strategies have garnered mixed reactions. While some see it as a necessary step to reduce government spending and national debt, others, including US Senator Elizabeth Warren, have been critical. Senator Warren has proposed increasing taxes and federal spending to make the government more efficient, contrasting sharply with DOGE's approach.

The proposed cuts to the IRS workforce are part of a larger effort by DOGE to reduce federal jobs and spending. This includes plans by the Social Security Administration to cut 12 percent of its workforce. The Securities and Exchange Commission (SEC) has also announced cuts to its regional office directors in compliance with the Trump administration’s cost-saving directives. Despite these cuts, the SEC's regional offices will remain open, and the agency has submitted its 2025 budget proposal to Congress requesting $2.6 billion.

The proposed 20% reduction in the IRS workforce is expected to have significant implications for tax collection and government efficiency. While the exact impact remains to be seen, the move underscores DOGE's commitment to reducing government spending and national debt through strategic cost-cutting measures. The proposed cuts, if implemented, could lead to a more streamlined and efficient federal bureaucracy, but they also raise questions about the potential impact on tax collection and government services.