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Washington, D.C.—A broad coalition of unions and public interest groups, led by the National Treasury Employees Union (NTEU), has written to every member of the House of Representatives in support of legislation that would, among other steps, repeal the authority of the Internal Revenue Service (IRS) to use private tax collectors. NTEU has been leading the fight against that program.

The letter expresses strong support for H.R. 5719, the Taxpayer Assistance and Simplification Act, to be considered by the House this week. The measure was introduced by Ways and Means Committee Chairman Rep. Charles Rangel (D-N.Y.); its private tax provision is modeled on legislation authored earlier by Ways and Means Committee member Rep. Chris Van Hollen (D-Md.).

In their letter, the groups call for retaining tax collection “in the professional and accountable hands of federal employees.” Under the IRS program—which lost $50 million in its first year of operation—private companies are permitted to keep a bounty of up to 24 percent of the money they collect.

That rate brought sharp criticisms from the coalition. “We believe that sky-high commission payments to the private contractors for work on the easiest to collect cases is unjustified and unnecessary,” they wrote.

In reviewing the financial performance of the program, the groups highlighted congressional action on “the problem of excessive commission rates,” pointing to a legislative overhaul of the Department of Education’s student loan program. A measure last year reduced from 23 percent to 16 percent the amount of recovered money private companies contracted by the government can retain on defaulted student loans.

“Why should private companies collecting taxes be allowed to retain 9 percent more?” they asked.

“We believe this misguided proposal is a waste of taxpayer dollars, invites overly-aggressive collection techniques, jeopardizes the financial privacy of American taxpayers, and may ultimately serve to undermine efforts to close the tax gap,” they wrote. The tax gap is the difference between taxes owed and taxes collected; it currently is put at some $345 billion and is growing annually.

The groups noted that while they strongly oppose the use of private companies to collect taxes, they “are committed to ensuring that each and every tax dollar owed is collected.” To that end, they pointed to the ability of IRS employees at 14 Automated Collection System (ACS) sites to contact taxpayers by telephone and collect delinquent taxes.

“The IRS itself has acknowledged that ACS employees can collect taxes at a far lower cost than private companies—generating a return on investment of 13 to 1 against the significantly lower 4 to 1 return by using private tax collectors,” they wrote.

Despite the continuing criticism of the program, including from members of Congress and the IRS’s own internal National Taxpayer Advocate, the IRS earlier this year renewed the contracts of two private companies.

In addition to NTEU, the letter was signed by the American Federation of Government Employees; American Federation of State, County and Municipal Employees; National Active and Retired Federal Employees Association; American Postal Workers Union; Professional Aviation Safety Specialists; Citizens for Tax Justice; OMB Watch; National Consumers League; Consumer Federation of America; Public Citizen; USAction; and the National Rural Letter Carriers Association.

NTEU is the largest independent federal union, representing 150,000 employees in 31 agencies and departments.