The Department of Government Efficiency (DOGE) is reportedly suggesting a 20% reduction in the workforce of the Internal Revenue Service (IRS), with this change anticipated to be implemented by May 15, 2025.
According to CNN, these workforce reductions would affect approximately 6,800 employees at the agency, in addition to the 6,700 probationary employees who have already been dismissed and 4,700 IRS agents who were offered severance packages to retire.
However, a recent ruling from US District Judge William Alsup, which mandates that federal agencies reinstate probationary workers who were terminated as a result of DOGE’s cost-reduction initiatives, could obstruct the layoffs unless the ruling is overturned.
President Trump has pledged to enact comprehensive tax reform across the United States, which may include the potential elimination of federal income tax and financing the federal government solely through tariffs imposed on foreign goods.
President Trump sharing his policy ideas with reporters inside the Oval Office. Source: The White House
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DOGE aims for efficiency and cost reduction
The Department of Government Efficiency, led by businessman Elon Musk, is investigating strategies to diminish the $36 trillion US national debt by significantly lowering the federal bureaucracy and implementing cost-saving measures.
Among the innovative proposals considered is moving all public expenditure on-chain to reduce deficits and promote transparency.
On February 21, the Securities and Exchange Commission (SEC) declared it would be reducing its regional office director positions to align with the Trump administration’s cost-saving strategies.
However, the reorganization plan will keep the regional offices, located in major US cities, operational, and the SEC has recently submitted its 2025 budget proposal to Congress, requesting $2.6 billion.
The US national debt has surged to over $36 trillion. Source: US Debt Clock
President Trump and Elon Musk have considered potentially distributing 20% of the savings generated by DOGE to Americans in the form of stimulus checks or tax credits.
Research from the accounting automation firm Dancing Numbers indicates that Trump’s proposition to eliminate federal income tax could save the average American $134,809 in lifetime taxes.
The firm further noted that this potential lifetime tax saving could increase to as much as $325,561 per individual if other wage-related taxes at the state level are also abolished.
Nonetheless, there are skeptics regarding DOGE’s cost-cutting initiatives, including US Senator Elizabeth Warren, who has voiced significant criticism of Elon Musk, Trump, and DOGE.
In January 2025, the Massachusetts Senator sent a letter to DOGE advocating for increased taxes and federal spending to enhance government efficiency.
Magazine: Elon Musk’s initiative to run the government on blockchain faces significant challenges
