Evening star., 1953-11-23
Tax Service
Urged 10 Alter
64 Districts
House Unit Asks
Internal Revenue
To Effect Changes
By Robert X. Walsh

A1cuUcQ CIl6 1lC6Tudl revenue
Service today for it's reforms
since January but cautioned that
too much decentralization will
cause confusion and inconsist-
ency in tax rulings.
But it recommended elimina-
ton or relocation of some of the
81 collection districts. The num-
Der and boundaries of the dis
tricts were fixed many years
ago and bear little relation to
the realities of present-day ad-
ministration," the subcommittee
said. 1t noted also that the new
administration improved oper-
ating efficiency by reducing the
number of regions from II to
nine and relocated several of
them.
The Ways and Means subcom-
mittee that cited flaws or favor
itiSm uncovered in it's two-year
investigation of administration
of the revenue laws declared:
Achievement of the basic fea-
ture of the reorganization plan
of 1852, elimination of political
appointment of bureau officials,
was major accomplishment in
revenue administration. Many
of the changes made in bureau
organization and structure ap-
pear to be basically sound.
Proper decentralization of au-
thority to the field should result
in better service to taxpayers at
less cost to the Government.
The subcommittee nevertheless
urged that the intelligence di-
vision be centralized at the re-
gional level instead of under the
general supervision of the dis
trict directors.
Trial Before More Changes.
However" it observed, In
ternal Revenue Service officials
have indicated a desire to give
the current structure trial be-
fore inaugurating any further
changes"
AS for other indications of
possibly too much decentraliza-
ton, the subcommittee said:
"On July l, 1858, the trans
initial of cases to Washington
for poSt-review was discontinued.
1t is planned to have this func-
ton performed instead at the
regional level but procedures for
this change have not yet been
worked out. 1t may be that the
post-review function can be per-
formed as well at the regional
level as it has been in Washing
ton.
ut must be recognized, how
ever, that regional post-review
will not be as effective in insur-
ing uniformity unless this work
is closely supervised by officials
from the national office. More
over, it seems unfortunate that
washington post-review was
abandoned before machinery had
been worked out for the per-
formance of the function at the
regional level.
Uniformity Problem.
Another critical problem is
the determination of the degree
to which the interpretative and
rule-making function can be de-
centralized. Obviously the need
for uniformity in the interpreta-
tion of the tax laws is as great
as the need for uniformity in
decisions on cases. Beyond the
point of routine matters, the
deSirability of delegation of au-
thority to the field is outweighed
by the need for assuring uni
formity in interpretations and
rulings. For this reason the
1nterpretative and rule-making
function in non-routine matters
is and must be reserved to some
central group at the national
Office"
The subcommittee, in the third
1nstallment of it's final report,
said 1t encountered difficulty in
getting information about events
that led to the reorganization.
The plan was submitted late in
the Truman administration. 1t
was retained and put into first
effect with some changes by the
present administration.
There are almost no records
on the subject either in the
Treasury or in the bureau" the
subcommittee stated. 1T has
been established, however, that
the decision to submit a reorgan-
1zation plan was made late in
December, 1851, at a time when
the SubcommitteeS activities
were a matter of great concern
to Treasury officials. The plan
was evidently drafted in haste
No one outside the Treasury
was consulted. Bureau officials
interviewed by the subcommittee
staff disclaimed any knowledge
of the origin or preparation OF
the plan. stating that the whole
thing was handled by the
Treasury"
While the reorganization plan
seems to be working well, the
subcommittee continued, there
still are signs of dual control
between district directors and
assistant regional commissioners
The subcommittee suggested that
lines of authority and RESPONSE
bility be clarified.