Statement of NTEU President Colleen M. Kelley On Debt Collectors Pursuing Deadbeat Contractors

Press Release March 14, 2006

If the Internal Revenue Service (IRS) is truly intent on making inroads into the huge and growing gap between taxes owed and taxes paid, a good start would be to pursue the more than $1.4 billion in unpaid taxes owed by government contractors. They would make easy and prime targets for the private sector debt collectors the IRS has just hired. The $1.4 billion estimate of such unpaid tax debts is from just 10 percent of federal contractors in 2004 and 2005, according to a study by the Government Accountability Office (GAO). In media reports, GAO said it found over much of those two years that “thousands” of federal contractors “abused the federal tax system with little consequence.” The IRS’s tax debt privatization program supposedly is aimed at tax debts that are known and readily collectible—such as these from deadbeat contractors. That these contractors take federal money then fail to pay appropriate taxes on it is outrageous. It illustrates why this administration’s contracting out program is out of control and turning the tax collection work over to profiteers is just another dangerous and risky move.

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