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Washington, D.C.—The leader of the union representing Internal Revenue Service (IRS) employees today welcomed recognition by the National Taxpayer Advocate (NTA) of the unique status of the IRS as the revenue-generator for the federal government, and called for implementation of NTA recommendations that would result in additional resources for the agency.

The recommendations—involving not only changes in government budgeting processes but in the mind-set that the IRS is a classic government spending program—were made as part of yesterday’s annual report to Congress by Taxpayer Advocate Nina Olson.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU), who earlier this month said additional IRS staffing is key to cutting the multi-billion-dollar gap between taxes owed and taxes paid, said the Olson recommendations “make good sense for our nation, and deserve a full hearing and analysis by the Congress.” Additional resources for the IRS “would benefit virtually every federal agency and every American,” she added.

“Underfunding the IRS leaves billions of dollars on the table and gives rise to bad policy decisions like privatizing the tax collection work of the IRS,” said President Kelley. The administration should immediately move to ask Congress for additional funds for the IRS for Fiscal Year 2007 and 2008 budgets.

Taxpayer Advocate Olson said the IRS occupies the position of the federal government’s accounts receivable department, and as such should be funded in accordance with a focus on its ability to produce what she called “a substantially positive return” on the funding it receives.

More funding for the IRS, within reasonable limits, Olson said, “should produce the opposite effect of more funding for most (government) programs—more resources for the IRS should reduce the federal deficit.”

It is clear, she added, that the IRS suffers from a ‘resources gap’ which serves as a significant impediment to its ability to close the tax gap and thus to reduce the budget deficit. The tax collection gap presently is put at some $345 billion a year, and is continuing to grow.

The IRS has to compete, dollar-for-dollar, against other federal programs for resources—a procedure she said that “makes little sense.” The Taxpayer Advocate, an independent voice within the IRS, called for “steady, but gradual” annual funding increases for the IRS personnel.

In her statement earlier this month, President Kelley—who has long been an advocate of adequate resources for every federal agency, including the IRS—said NTEU supports a two percent annual net increase in staffing for the IRS over a five-year period to add roughly 1,885 position per year. That would gradually rebuild what Kelley called the “depleted” IRS workforce to pre-1998 levels.

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