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Washington, D.C.—Legislation approved by the House of Representatives in the last session of Congress that would revoke Internal Revenue Service (IRS) authority to hire private sector debt collectors was introduced late yesterday as opposition to the controversial program continues to grow. Most recently, the National Taxpayer Advocate called on Congress to stop the private collection program.

The measure, H.R. 695, was introduced by Rep. Chris Van Hollen (D-Md.) and Steve Rothman (D-N.J.) and mirrors a bill Rep. Van Hollen introduced last year that was approved by the House. The current legislation already has bipartisan support among its 44 co-sponsors.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU)—who has been leading the fight against privatizing tax collections—welcomed the Van Hollen-Rothman bill and called for prompt passage by the House.

“There is great risk and cost to taxpayers inherent in the IRS program, with little promise of meaningful return,” she said. “Still, it’s clear the IRS is determined to move ahead despite the widespread opposition to its plan, so it appears the way to stop it is to repeal its authority to hire and use private sector debt collectors.”

The IRS launched the program in September using three debt collection companies and has plans to expand the program to as many as 10 private collection agencies as early as March.

Both Rep. Van Hollen—recently appointed to the powerful Ways and Means Committee—and Rep. Rothman—a key member of the Appropriations Committee—are outspoken opponents of the IRS plan.

In addition to the Van Hollen-Rothman bill, Senate legislation was introduced earlier this month by Sen. Byron Dorgan (D-N.D.) and Sen. Patty Murray (D-Wash.) that instructs the IRS to suspend “immediately and indefinitely” its use of private debt collectors—and contains a prohibition against using funds appropriated to the IRS is fiscal 2007, “or any subsequent year,” to implement the program.

The Dorgan-Murray bill came after National Taxpayer Advocate Nina Olson, in her annual report to Congress, called for repeal of IRS authority to use private debt collectors—a call strongly endorsed by President Kelley.

In calling the privatization program one of the “most serious problems” facing taxpayers, Olson pointed out that the IRS itself has acknowledged it can collect delinquent accounts more efficiently than private debt collectors.

Under the IRS plan, she said, the government “has the privilege of paying up to 25 percent of any taxes collected (by) private collection agencies, even while estimates show that IRS employees could perform the work more efficiently.”

In testimony before Congress, IRS Commissioner Mark Everson has twice acknowledged that using private collection companies to collect federal taxes will be more expensive that having the IRS do the work themselves.

Olson also warned of other problems in the plan, including poor customer service to multilingual taxpayers, private collection company operating plans being withheld from public disclosure and the use of telephone collection scripts through which the private companies’ employees attempt to manipulate taxpayers.

NTEU is the largest independent federal union, representing some 150,000 employees in 30 agencies and departments, including 94,000 in the IRS.