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Washington D.C. — In its approval of the Tax Collection Responsibility Act of 2007, the House Ways and Means Committee “has taken a concrete step” toward ending the unwise and costly use by the Internal Revenue Service (IRS) of private tax debt collectors, the leader of the union representing IRS employees said today.

H.R. 3056 would repeal the IRS’s authority to hire private collectors and is “a reflection of the strong opposition in Congress to the IRS tax privatization plan,” said President Colleen M. Kelley of the National Treasury Employees Union (NTEU), after the Ways and Means Committee markup of the bill.

“Revoking the IRS’ authority to hire private tax collectors ensures that taxpayers will be protected from abusive collection methods and that the tax collection work of the government will be carried out in a cost-effective manner,” said Kelley. “Letting debt collectors keep 25 percent of the take when there is a better alternative is tantamount to fleecing American taxpayers.”

The measure was approved in the aftermath of a May hearing by the committee which made clear a number of significant problems with the IRS program—including the use by private companies of abusive collection tactics; the fact that IRS employees can do the work more efficiently, with a 13 to 1 return on investment versus the 4 to 1 return by the private tax debt collectors; and collector authentication practices that increase the likelihood of identity theft by urging taxpayers to reveal their Social Security numbers to strangers over the telephone.

The repeal language was advanced by Committee Chairman Charles Rangel (D-N.Y.) and Rep. Chris Van Hollen (D-Md.).

On a dual track, the Senate Appropriations Committee last week passed legislation signaling serious concern with the IRS private tax debt collection program by limiting funding for the initiative in the 2008 Financial Services and General Government Appropriations bill. In addition, a provision in the bill directs the IRS to pursue retraining and reassigning of IRS employees facing job cuts to do collection work rather than simply shifting that work to the private sector.

NTEU has been leading the fight against the privatization of the inherently governmental function of collecting taxes; and has been joined in its call for repeal of IRS authority to engage in the practice by the agency’s own National Taxpayer Advocate and by a variety of national consumer protection groups.

Along with the cost issue, NTEU and other opponents of the program have cited the serious risk to taxpayers’ personal and sensitive information by putting it in the hands of private companies.

President Kelley said H.R. 3056 deserves prompt enactment into law, calling it “an important step in protecting the integrity of our voluntary tax system.”

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