The I.R.S. lost roughly a quarter of its employees since President Trump took office, hampering the agency’s ability to conduct audits.
Page F2From§Eachthe milkman edition — 1 September 2026
IRS audit revenue plunges as tariff refunds jolt the economy
Audit revenue from the IRS has plummeted, according to the inspector general, while the tariff refund mechanism—activated after a Supreme Court defeat—injects temporary growth into the economy. The sequence is precise: enforcement slackens, collections drop, but refunds fill the ledger on the other side. The gap between lost audit revenue and the tariff refund is as wide as the fiscal year, and the temporary jolt is a penny-ante fix for a structural shortfall. The column gap turns up in the quarterly report, filled by the check that comes with a receipt and leaves with a deficit. In lieu of a permanent fix, the economy takes a victory lap on borrowed funds.
“IRS audit money dries up, but tariff refunds come in to give the economy a sugar high. One hand empties the till, the other waves a check—just long enough for the cameras. The real audit is on who gets the refund and who gets the bill.”
“Taxpayers win when the IRS steps back, right? Lower audit revenue means fewer hassles, and tariff refunds provide a much-needed boost. Sure, it's temporary, but isn't that better than nothing? Wait, did I say 'steps back'? The IRS still does its job, just...less aggressively. Or more efficiently. No, that's not it.”
The receipts
Slok published his analysis August 15 Slok estimated that tariff refunds would contribute roughly 0.2 percentage points to that growth rate — meaning the refunds alone account for roughly 4.7% of the projected increase.
This page is a back-issue: the story as it ran, receipts as they were. The current edition is at the front.