March 21, 2010 6:36 AM
Law Enforcement ExaminerJim Kouri“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.” -- C. S. Lewis (1898 - 1963)
The Internal Revenue Service (IRS) will see its largest expansion since withholding taxes were first enacted during WWII to enforce the glut of new tax mandates and penalties included in the Democrats’ latest health care plan, according to Rep. Kevin Brady (R-TX).A new analysis by the Joint Economic Committee and the House Ways & Means Committee minority staff estimates up to 16,500 new IRS personnel will be needed to collect, examine and audit new tax information mandated on families and small businesses in the ‘reconciliation’ bill being taken up by the U.S. House of Representatives this weekend, according to Brady.
“When most people think of health care reform they think of more doctors exams, not more IRS exams,” says U.S. Congressman Kevin Brady, the top House Republican on the Joint Economic Committee. “Isn’t the federal government already intruding enough into our lives? We need thousands of new doctors and nurses in America, not thousands more IRS agents.”
Scores of new federal mandates and fifteen different tax increases totaling $400 billion are imposed under the Democratic House bill. In addition to more complicated tax returns, families and small businesses will be forced to reveal further tax information to the IRS, provide proof of ‘government approved’ health care and submit detailed sales information to comply with new excise taxes.
Scores of new federal mandates and fifteen different tax increases totaling $400 billion are imposed under the Democratic House bill. In addition to more complicated tax returns, families and small businesses will be forced to reveal further tax information to the IRS, provide proof of ‘government approved’ health care and submit detailed sales information to comply with new excise taxes.
Unfortunately, according to the Center for American Progress, the structure of the IRS' use of private agencies to collect "debts" encourages abuse. Under the current program, collectors are awarded as much as 25 cents of every dollar they collect, in addition to a $100 bonus for every account they close.
The Internal Revenue Service strategy of paying private debt collectors a 25 percent commission to collect unpaid tax debt originally met with bipartisan resistance from Congress. They claimed that the proposal jeopardized the rights and privacy of American taxpayers. Several organizations voiced their objections to the IRS proposal and have expressed their strong support for the consumer protection legislation Rep. Chris Van Hollen introduced: Citizens for Tax Justice, Consumer Federation of America, Consumers Union, National Consumer Law Center, National Consumers League.
The very nature of the program provides incentives for collectors to push the limits of legality to extract a little more revenue from their targets. As part of the IRS Restructuring and Reform Act of 1998, Congress, fearing overly aggressive collection practices, explicitly prohibited the IRS from compensating its own collectors based on the amount of money they collect. If Congress believes that incentive-based pay will cause official IRS collectors to cross the line, why would they think private collectors would behave any differently?
Although IRS officials indicated that the purpose of the limited implementation phase was to assure readiness for full implementation using up to 12 private collection agencies, the IRS has not documented how it will identify and use the lessons learned to ensure that each critical success factor is addressed before expanding the program even further during the current atmosphere of extraordinary government spending.
Because program's success will be affected by how well IRS makes adjustments, assessing the lessons learned in limited implementation is critical. Also, IRS has not documented criteria that it will use to determine whether the limited implementation performance warrants program expansion.
IRS officials indicated that they are considering criteria that could trigger a go/no go decision, such as the amount of penalties collected from Americans unwilling or unable to purchase health care insurance and there are some indications of PCAs abusing taxpayers or misusing taxpayer data.
Paying private debt collectors on a commission basis is costly and threatens the rights and privacy of the American taxpayers. Congress must ensure, as this resolution seeks to do, that federal tax collection functions will not be handed over to private sector bounty hunters.
Full story HERE
