I

103D CONGRESS

1ST SESSION H. R. 2406

To provide the Internal Revenue Service with increased authority and resources to be used in reducing evasion of the diesel fuel taxes and

other tax evasion.

IN THE HOUSE OF REPRESENTATIVES

JUNE 14, 1993

Mr. ISTOOK (for himself, Mr. GRANDY, Mr. BARLOW, Mr. LIGHTFOOT, Mr.

WOLF, Mr. WILSON, Mr. GREENWOOD, Mr. MCDADE, Mr. INHOFE, Mr.

MICHEL, Mr. PACKARD, and Mr. BATEMAN) introduced the following bill;

which was referred to the Committee on Ways and Means

A BILL

To provide the Internal Revenue Service with increased authority and resources to be used in reducing evasion

of the diesel fuel taxes and other tax evasion.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Diesel Fuel Tax En5 forcement Act of 1993’’.
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1 SEC. 2. SENSE OF THE CONGRESS AS TO INCREASED IN2 TERNAL REVENUE SERVICE FUNDING FOR

3 CRIMINAL INVESTIGATIONS AND OTHER EN4 FORCEMENT ACTIVITIES.

5 (a) FINDINGS.—The Congress hereby finds that—

6 (1) there has been substantial evasion of the

7 Federal excise taxes on diesel fuel,

8 (2) there is evidence that organized crime has

9 become involved in such evasion,

10 (3) that such evasion undercuts the many small

11 and medium size businesses who comply with the

12 diesel fuel taxes, and

13 (4) providing the Internal Revenue Service with

14 additional funding for its criminal investigation and

15 other enforcement activities would—

16 (A) enable the Internal Revenue Service to

17 be more effective in its effort to reduce orga18 nized crime’s involvement in tax evasion and

19 other criminal activities such as money launder20 ing, and

21 (B) result in increased revenues.

22 (b) SENSE OF CONGRESS.—It is the sense of the

23 Congress that outlays for Internal Revenue Service crimi24 nal investigation and other enforcement activities should

25 be increased and such increase shall be funded with offset26 ting spending reductions in other program areas.
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1 SEC. 3. PERMANENT EXTENSION OF AUTHORITY FOR UN2 DERCOVER OPERATIONS.

3 (a) PERMANENT EXTENSION.—Notwithstanding the

4 provisions of paragraph (3) of section 7601(c) of the Anti5 Drug Abuse Act of 1988, the amendments made by such

6 section 7601(c) shall apply to all periods after the date

7 of the enactment of this Act.

8 (b) ENHANCED OVERSIGHT.—

9 (1) ADDITIONAL INFORMATION REQUIRED IN

10 REPORTS TO CONGRESS.—Subparagraph (B) of sec11 tion 7608(c)(4) of the Internal Revenue Code of

12 1986 is amended—

13 (A) by striking ‘‘preceding the period’’ in

14 clause (ii),

15 (B) by striking ‘‘and’’ at the end of clause

16 (ii), and

17 (C) by striking clause (iii) and inserting

18 the following:

19 ‘‘(iii) the number, by programs, of un20 dercover investigative operations closed in

21 the 1-year period for which such report is

22 submitted, and

23 ‘‘(iv) the following information with

24 respect to each undercover investigative op25 eration pending as of the end of the 1-year
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1 period for which such report is submitted

2 or closed during such 1-year period—

3 ‘‘(I) the date the operation began

4 and the date of the certification re5 ferred to in the last sentence of para6 graph (1),

7 ‘‘(II) the total expenditures

8 under the operation and the amount

9 and use of the proceeds from the op10 eration,

11 ‘‘(III) a description of the oper12 ation including the potential violation

13 being investigated and whether the

14 operation is being conducted under

15 grand jury auspices; except that such

16 a description shall not be required if

17 the Secretary determines that to pro18 vide such description would jeopardize

19 the operation or the life or safety of

20 participants in the operation, and

21 ‘‘(IV) the results of the operation

22 including the results of criminal pro23 ceedings.’’

24 (2) AUDITS REQUIRED WITHOUT REGARD TO

25 AMOUNTS INVOLVED.—Subparagraph (C) of section
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1 7608(c)(5) of such Code is amended to read as fol2 lows:

3 ‘‘(C) UNDERCOVER INVESTIGATIVE OPER4 ATION.—The term ‘undercover investigative op5 eration’ means any undercover investigative op6 eration of the Service; except that, for purposes

7 of subparagraph (A) of paragraph (4), such

8 term only includes an operation which is exempt

9 from section 3302 or 9102 of title 31, United

10 States Code.’’

11 (3) EFFECTIVE DATE.—The amendments made

12 by this subsection shall take effect on the date of the

13 enactment of this Act.

14 SEC. 4. REPORT BY ATTORNEY GENERAL.

15 Not later than the day 90 days after the date of the

16 enactment of this Act, the Attorney General shall report

17 to the Congress on—

18 (1) the feasibility of additional Federal task

19 forces dealing with organized crime’s involvement in

20 diesel fuel tax evasion, and

21 (2) other steps that could be taken to reduce

22 criminal evasion of diesel fuel taxes.

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