As you may know, the gross tax gap has increased from $345 billion dollars in TY2001 to $450 billion in TY2006. Moreover, the IRS has singled out underreporting of income amongst businesses and corporations as among the primary reason for this gap. However, we would like to remind you that this tax gap is not entirely the fault of accounts payable professionals such as our readers.

For instance, another critical component of the tax gap is tax evasion conducted by high-income individuals. This is done typically through gaming the system. For instance, the use of Swiss bank accounts (and other offshore tax haven banking systems). FATCA (the Foreign Account Tax Compliance Act) is in large measure about addresing such issues. Nevertheless, the IRS has also identified approximately 21,000 high income Americans who in 2009 paid no federal income tax! Some 40 years ago, and also in a time of war - Vietnam in that case - Congress passed the AMT (alternative minimum tax) in response to public outcries surrounding the fact that at that time a mere 155 individuals were not paying federal income tax.

Of course today, efforts to close the tax gap seem to fall more on the shoulders of the standard accounts payable employee who not only is attempting to perform their basic job duties, but also achieve compliance with a blizzard of annually changing rules and regulations regarding third party reporting in the business world. Astute observers recognize the injustice of this situation, hopefully in an election year such as this one, dominated as it is by discussions of debt, Congress will soon do so as well.