Kelley Critical of Procedural Roadblock to Vote on Merits Of Tax Debt Privatization Plan; Vows Continued Fight

Press Release June 30, 2005

Washington, D.C.—The leader of the union representing Internal Revenue Service (IRS) employees today criticized a procedural move in the House of Representatives preventing a vote on an amendment that would have kept the IRS from using private collection agencies to collect tax debts.

“I am confident,” said President Colleen M. Kelley of the National Treasury Employees Union (NTEU), “that, in a vote on its merits, legislation directing the IRS to abandon its unwise and unnecessary tax debt privatization plan would be approved by the House.”

Earlier today, during debate on the fiscal 2006 Transportation-Treasury Appropriations bill, Reps. Rob Simmons (R-CT) and Chris Van Hollen (D-MD) withdrew their anti-privatization amendment after a procedural point of order was raised against it.

Kelley said NTEU will continue its fight to enact a free-standing bill, H.R. 1621, introduced by Reps. Simmons and Van Hollen, which would accomplish the same purpose as their proposed amendment.

At the same time, and despite the procedural roadblock, the NTEU leader took note of the strong comments offered on the House floor during today’s debate on the Simmons-Van Hollen amendment. Kelley said the comments show that “members of Congress understand the multiple dangers to taxpayers involved in the IRS plan” to hire private debt collectors to go after tax debts in exchange for up to 25 percent of the money they collect. The program was authorized last year in an unrelated tax bill.

Rep. Simmons was direct in his House comments, warning of the likelihood of “abuse and harassment” of taxpayers by private sector debt collectors—annually, the most complained-about industry in America.

The Connecticut Republican also took note of the rising incidence of identity theft across the nation and warned that once an individual’s confidential and personal information gets into the hands of an unscrupulous person, the individual is “permanently at risk” that his or her information will be misused for financial crimes or other improper or illegal purposes.

Rep. Van Hollen, meanwhile, told his colleagues that the amendment was a necessary remedy to the “special-interest provision” that was “snuck into law” last year permitting the IRS to go ahead with the tax debt privatization plan. And he urged members not to turn over taxpayers’ private information “to commission-based bounty hunters,” as would be done under the IRS plan.

Another House member, Rep. John Olver (D-MA), warned that contracting out this “inherently governmental role” of collecting taxes would result in additional costs to taxpayers, compared to the cost of having IRS employees do the work.

NTEU has been leading the fight against the IRS plan. In addition to the growing opposition in Congress to privatization of tax collection, a number of advocacy and public interest organizations have expressed their considerable concern about its impact on their constituents.

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