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Washington, D.C.—The head of the National Treasury Employees Union (NTEU) today welcomed support from a number of members of Congress for NTEU’s arguments that privatizing tax debt collection is not only a serious risk to taxpayer privacy, but is far more expensive than having Internal Revenue Service (IRS) employees perform the task.

“I’m pleased that so many members of the House Appropriations Committee raised concerns about both taxpayer service and private tax collection,” said NTEU President Colleen M. Kelley. “Today’s hearing reinforces NTEU’s strong belief that IRS employees collect more, cost less and protect

She added: “There was a strong case made for investing in additional IRS employees to close the tax gap and provide needed assistance to America’s taxpayers.” During the hearing, even IRS Commissioner Mark Everson admitted that it would be less expensive for IRS workers to collect tax debts rather than private contractors.

The support for the union position on the now-delayed IRS plan to hire private sector debt collectors to pursue tax debts in exchange for a bounty was evident during a hearing of a House subcommittee on the fiscal 2007 Transportation, Treasury Appropriations bill. Subcommittee members expressed their views to Commissioner Everson, who was presenting testimony on the agency’s budget.

Rep. Ed Pastor (D-AZ) called the private tax collection initiative a “bad idea;” he was joined in his criticism of the program by Rep. Steven Rothman (D-NJ) who said it ultimately will cost taxpayers

much more to hire outside contractors—who will be paid a bounty of up to 25 percent of the money they collect—than to have IRS do the work; and Rep. Carolyn Kilpatrick (D-MI), who expressed her

view that the work properly belongs in the hands of IRS employees.

NTEU has been leading the fight against the IRS plan. The agency awarded three contracts to private debt collectors earlier this month, but the project was delayed when two losing private sector bidders filed appeals with the Government Accountability Office. NTEU is pressing for approval of H.S. 1621, which would revoke the authority of the IRS to engage in the tax debt privatization program.

On an important related matter, the IRS’s National Taxpayer Advocate, Nina Olson, said that a better course for the IRS would be for Congress to allow it to count the revenue that would be generated by hiring additional personnel for collection efforts rather than charge those employment costs against the IRS as an expense.

Rep. Rothman agreed with that position; he said that ‘dynamic budget scoring’ should be used in order to more accurately reflect what it would both cost and save taxpayers for federal employees to perform the work that is being handed over to private collection agencies.

Subcommittee ranking Democratic member Rep. John Olver (D-MA) voiced his concern that the IRS is claiming to perform more audits and hiring additional employees to address enforcement issues—and the more than $300 billion gap between taxes owed and those collected—even though it had not requested additional resources for those purposes.

NTEU is the largest independent federal union, representing 150,000 employees in 30 agencies and departments, including 90,000 in the IRS.