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Washington, D.C.—Action by the House Ways and Means Committee yesterday in dropping a proposal that would have permitted private debt collection agencies to collect taxes on commission reflects both bipartisan congressional and public opposition to the proposal, the leader of the nation’s largest independent union of federal employees said today.

The proposal, which was dropped from an unrelated international tax bill, would have allowed the Internal Revenue Service to hire private debt collectors to pursue taxpayers and to be paid a bounty of up to 25 percent of the money they collect.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) called the Ways and Means Committee action “a major victory for taxpayers.” NTEU has been leading the opposition to the proposal, which includes a number of major consumer groups.

Two weeks ago, a nationwide poll showed that two-thirds of Americans oppose the idea of allowing the IRS to hire private debt collection companies—a number that rose to 79 percent in opposition when details of the plan were provided. The percentage climbed still further—to 84 percent opposed—when respondents were asked about their level of concern with having their personal tax information provided to private debt collectors.

Earlier this month, 14 Republican members of the House expressed their opposition to the proposal in a letter to Speaker Dennis Hastert. They raised serious concerns about the confidentiality of taxpayer information, and said “the American public views the information gathered by, and disclosed to, the IRS as wholly confidential.” They added: “Tax collection is one function that is, and should remain, inherently governmental.”

NTEU’s opposition has been focused not only on the dangers of providing sensitive taxpayer information to private companies, but on the potential for taxpayers to face abusive tactics by debt collectors. What’s more, the union has emphasized that the IRS itself has said that agency employees could collect more money more efficiently than debt collection companies.

The agency’s figures show that with only a modest investment in resources, IRS employees could generate 10 times the return from using private contractors. That would result in a return of $30 for every dollar invested, compared with a return of only $3 for every dollar paid to debt collection agencies.

NTEU is the largest independent federal union, representing some 150,000 employees in 29 agencies and departments, including more than 97,000 in the IRS.