WASHINGTON, D.C. -- Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA), and Ways and Means Member Chris Van Hollen (D-MD), applauded the Internal Revenue Service’s (IRS) decision to end the use of private contractors to collect Federal taxes. The IRS decision not to renew its contracts with two private debt collection agencies comes after an extensive review of the program, including the cost effectiveness of the effort. Chairman Lewis and Congressman Van Hollen also recently introduced legislation to repeal IRS’ authority to use private contractors to collect Federal taxes; similar legislation passed the House of Representatives three times in the last Congress. Many Committee Members have advocated for repeal of the private debt collection program, arguing that tax collection is an inherent Government function and that professional IRS agents are more efficient at collecting outstanding tax debt.
“Commissioner Shulman made the right decision to end the private debt collection program," said Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA). “The IRS has trained professionals to help taxpayers through any difficulties they may have. They can do a much better job at collecting outstanding tax debt and taxpayers deserve to work directly with the IRS who can offer them a wide range of services. I applaud Commissioner Shulman’s decision to hire 1,000 new public servants to bolster IRS collection efforts, restore public trust, and protect taxpayers from unfair tactics."
“Commissioner Shulman’s announcement that the IRS will end the misguided practice of private tax collection is welcome and long overdue," said Congressman Chris Van Hollen (D-MD), a leading congressional advocate for terminating the IRS’ private debt collection authority. “Data has repeatedly shown the IRS to be far more cost-effective at collecting back taxes and far less prone to abusing taxpayers’ rights. This decision is a resounding victory for good government and the public it serves."
In 2007, the Committee conducted an investigation into the use of private debt collectors and found that their services often subjected taxpayers to undue harassment and confusion not associated with the use of trained IRS agents. Further, the Committee learned that the IRS’ collection program includes counseling and tax account adjustments not offered by private collectors. IRS taxpayer services are critical to ensuring a tax system fair to our taxpayers.
