The key problem is this insidious idea that money brought in by the IRS is "profit", or even just "revenue". That's only the case if you're looking at the IRS i

The key problem is this insidious idea that money brought in by the IRS is "profit", or even just "revenue". That's only the case if you're looking at the IRS in isolation. The government, and by extension the IRS, is supposedly working for society. Money moving from the private sector to the public sector is not "revenue" from society's point of view; it's more like shifting money between two different bank accounts within the same organization. Money which the IRS doesn't collect is still part of society, and still doing good—just not under the auspices of the government. So the question is, for every dollar spent on the IRS, how much money is shifted from the private sector to the public sector; but more importantly, per dollar spent on the IRS, how much benefit is there to having the government spend that money instead of the private party that earned it? (Some would suggest that this "benefit" is negative even if the IRS could achieve perfect enforcement of the tax code for free...)