John Sarbanes: “I am in support of the Dorgan amendment to the reconciliation tax cut bill that would strike a provision in the bill to…”

“I am in support of the Dorgan amendment to the reconciliation tax cut bill that would strike a provision in the bill to privatize tax collection by the Internal Revenue Service. The proposal to privatize tax collection is misguided. Privatizing tax collection will hurt both Federal employees, by contracting out Federal jobs, and taxpayers, who could be subject to the abuse and mismanagement of a private company. Privatization of tax collection has already been tried by the IRS in a 1996 pilot project. The pilot project was such an extraordinary failure that a further 1997 pilot project was cancelled. The contractors who conducted the project did not protect the sensitive information of taxpayers, and the project ultimately did not save the Federal Government any money. The proposal would allow private companies to engage in collection activities without providing adequate safeguards for taxpayers against abusive activities. It is my understanding that the Fair Debt Collections Practices Act, known as FDCPA, which provides the most important protections for consumers from abusive or unfair actions by debt collectors, would not fully apply to the activities of the private tax collectors. I am particularly concerned that a taxpayer's ability to recover certain damages from an abusive private tax collector may be severely limited under this proposal. In addition, the privatization of tax collection is a major change to the way our Government works.”