Grassley Wins Support of Pro-Taxpayer Groups for IRS Restructuring Bill


Former Treasury Secretaries, CPAs, Taxpayer Advocates Call for Action


Scott Stanzel

202/224-6197


Demonstrating the broad, bi-partisan support for a major overhaul of the Internal Revenue Service (IRS), Sen. Chuck Grassley of Iowa was joined at a press conference today on Capitol Hill by eight major groups announcing their backing of the Kerrey-Grassley/Portman-Cardin IRS Restructuring and Reform Act of 1997.

"I am pleased to have such a strong showing of support for this common-sense legislation," said Grassley. "The management culture at the IRS has lead to institutional arrogance and abuse of taxpayers. Substantial changes must be made to eliminate the ?we-versus-them' mentality at the agency. Our legislation would demand accountability and hold the IRS to the same high standards that the agency itself applies to the American taxpayer."

The legislation is based on the recommendations of the bipartisan National Commission on Restructuring the IRS, which completed a yearlong audit of the IRS and released its final report on June 25, 1997. Provisions of the legislation include:

  • Creates independent oversight of the IRS through a Citizens Oversight Board.
  • Ensures that the 85% of taxpayers who voluntarily pay are treated fairly.
  • Allows taxpayers to recover attorney's fees when the IRS is wrong.
  • Allows recovery of up to $100,000 for negligent IRS collection actions.
  • Requires a first-time taxpayer survey to measure whether employees are well trained and treat taxpayers with respect.
  • Creates flexibility in civil service rules so good employees can be rewarded and poor employees will be dismissed.

Grassley served on the 17-member panel, which was chaired by Sen. Bob Kerrey of Nebraska and Rep. Rob Portman of Ohio. The Commission's recommendations and the subsequent Kerrey-Grassley/Portman-Cardin bill represent the first comprehensive proposal for reforming the IRS since 1952. Rep. Ben Cardin of Maryland joined Portman to introduce the bill in the U.S. House of Representatives.

The organizations formally endorsing the legislation are as follows:

  • National Treasury Employees Union
  • National Taxpayers Union
  • Americans for Tax Reform
  • American Payroll Association
  • American Institute of Computerized Tax Processors
  • National Association of Enrolled Agents
  • National Society of Accountants

Some of the individuals supporting the plan include The Honorable James A. Baker, III former Secretary of the Treasury; The Honorable Nicholas F. Brady, former Secretary of the Treasury; Dr. Robert Stobaugh, Professor of Governance, Harvard Business School; and Dr. Roy Schotland, Professor, Georgetown University Law School.

As members of the Senate Finance Committee, Grassley and Kerrey participated last week in three days of hearings to investigate abuse and mistreatment of taxpayers by the federal government's tax-collecting agency. These landmark hearings were the first oversight hearings of the IRS in 21 years. Grassley said he wants to see "continued vigorous, sustained oversight by Congress to check some of the abuses we heard about last week. I have learned over the years that oversight of the IRS is a step-by-step process, and a long-term commitment. There's a need for Congress to maintain vigilance over the IRS," he said.

Grassley won passage of the first-ever Taxpayer Bill of Rights in 1988, with the co-sponsorship of former Sen. David Pryor of Arkansas. Grassley and Pryor joined forces again to gain passage by Congress and the signature of the President in 1995 of the second Taxpayer Bill of Rights II, known as T2.