Date: 1997-09-26
Speaker: BILL ARCHER (republican)
Chamber: H

chairman of the Committee on Ways and Means. or the gentleman from Louisiana. Mr. BILLY TAUZIN. or the gentleman from Colorado. Mr. DAN SCHAEFER. and they propose no income taxes or no business or corporate taxes at all. just a national sales tax. Now. those are two good ideas. I am sure there are many more out there out across this country. and once people realize we are serious about sunsetting the Tax Code. I think we will be flooded with good ideas. just as we were during the balanced budget debate on how we can move forward with a better. fairer system of taxation in this country. But there is another reason to change. and thatis a fundamental philosophical one. This current 5.5 millionword Tax Code. which is enforced by 113.000 IRS folks. which is changed and meddled with constantly by 535 Members of Congress. this does more than just cause inconvenience. it limits other personal and economic freedom. and it discriminates against children and families and entrepreneurs. The Tax Code encourages. as I mentioned. hundreds of billions of dollars in tax costs of preparation and it also incurs hundreds of billions of dollars in the underground economy. which we never find out about and which is never taxed and the revenue is lost to the Government. I think most of all the complexity and unfairness of the Tax Code leads most folks back home to distrust the Tax Code. I know when I hold town meetings throughout the Finger Lakes or western New York. in Buffalo or Rochester or Syracuse. New York regions. people come to me all the time and say they do not believe in the system. it does not work. this tax system. and they lose their faith in a Congress that has put this in place or a Government that enforces it. We can change all that. If there has ever been a reason to make change. all we have to do is walk out of this Chamber and down to the other body at the other end of this Capitol and listen to the discussion that has been going on in the committee chaired by Senator BILL ROTH from Delaware on the Senates Committee on Finance. that has been holding hearings this week. bringing in current and former IRS agents and other experts who have been talking about the abuses of this current system and how it is unfair. They have done it in the Senate. and earlier this year Money magazine devoted a lot of attention to this issue. And they have said that the Internal Revenue Service says that they are simply implementing the Tax Code that Congress put in place. There is no arguing the current code is too complex. but any agency with the power of the Internal Revenue Service needs to be watched very. very closely. Whether it is Money magazine or "60 Minutes". the CBS show last Sunday night. or the Senate hearings. they have been underscoring these kind of statistics. which are frightening. The fact is that more than 8 million Americans a year receive incorrect tax bills. incorrect tax billings from the Interlfal Revenue Service. Or the refunds are incorrect because of mistakes made by the IRS when entering information in their computers. That is 8 million wrong tax bills or refunds. That is as if every tax bill or refund was wrong for all the taxpayers of Alaska. Delaware. Hawaii. Montana. Nebraska. Nevada. North Dakota. South Dakota. Vermont. and Wyoming. 10 States worth of wrong taxes or wrong refunds sent out by our Government. What kind of company in the private sector would stay in business very long with those kind of statistics? The IRS has wasted more than $5 billion since 1986 in an effort to modernize their computers. Just think of that. they cannot even get a computer system set up to handle all the information that comes in. These are the kinds of things that are concerning the taxpayers across this country. In fact. in a Money magazine nationwide poll. taxpayers believe the IRS collection tactics are heavyhanded. intrusive. and outdated. As a matter of fact. 34 percent of taxpayers who have been audited said the IRS acted rudely or were asked probing questions about their lifestyles that had nothing to do with their taxes. My colleagues in this Chamber. you know and I know. we hear it all the time from our constituents. we do not need a magazine to prove it. We do not need "60 Minutes" to prove it. And frankly. even though they are important hearings. we do not need more Senate hearings. What we need is action. I am pleased with the fact that the IRS itself is starting to get the message. In the Washington Post today the headline is. "Beleaguered IRS Announces Steps to Curb Abuses. Agency Wont Rank District Offices on Revenue Collected Acting Chief Tells Senators." In other words. they.heard all the testimony in the Senate. and the IRS is rushing out to say. OK. we will clean up our act. It says. "The Internal Revenue Service. battered by 3 days of Senate hearings into agency abuse of taxpayers. of its own employees. yesterday announced a series of steps to ease the pressures that some IRS workers sayi lead to the problems. The acting qommissioner. Michael Dolan. told the financial committee that they will stop ranking their district offices based on revenue collected." What does that mean? What it means is that they are admitting what we know is the case. that there is in effect quotas. that IRS employees are told. "You are going to be graded and ranked." The offices are. so the individuals clearly. it all adds up. are ranked based on what they collect. That means there is tremendous pressure to collect more. Do not worry whether or not it is fair or unfair. just go out there and get those dollars and make those seizures. I do not think that is the way we want our Government to work. But the Acting Commissioner Michael Dolan said. "I dont come here." to the Senate this is. the other body. "in denial. The IRS is trying very hard to make a priority of serving lawabiding taxpayers." My colleagues. that is an impossibility. The Acting Commissioner may be going in doing a mea culpa. may be going in and saying. "We are going to make some changes." but they are temporary. They will not last. We get this every few years we go through this cycle. They cannot. because while the vast majority of folks who work with the IRS are good and honorable people. they are caught in a system that is impossible to administer. They could not. even with $5 billion. billion with a "B". develop a computer system to handle this whole tax system. How in the name of the good Lord could they ever come up with a system that is going to ensure that these kinds of abuses do not occur in the future? They cannot. When you have 51/2 million words in the tax system administered by 113.000 people that have such great discretion over their interpretation of those rules. when you have 535 people in Congress meddling in this. and by the way. I would point out that we do our share to make this system worse. During the decade of the 1980s. Congress changed the tax law 100 times. The 1986 tax reform alone added 100 new forms to the tax system. And even the things that we did this summer which were good. they were tax cuts. Money magazine says one alone. capital gains changes we made. will add 37 new lines to the capital gains form. So when we have got all this activity going on. who loses? The taxpayer. The system will never change. The IRS Commissioner can be doing this in good faith. saying. "We are going to try harder." It will not work. It is doomed to failure. I predict that if 50 percent of Americans today are seeking help filling out their tax forms. within the next 2 years. that number will rise. It will be 51 or 52 percent. More Americans will be upset with the system. The only solution is the solution that moves this country forward to give ourselves a better future. to open the opportunity for the next millennium to be better. the next 100 years in this Nations history better than the last 100 years. As we enter the next millennium. the next 1.000year cycle. would it not be wonderful to do so with a new system of taxation in this country? We began the early years of this century putting in place the current Internal Revenue system. about 1913. My bill will sunset it on the last day of this century. We would have begun and ended this century with the Internal Revenue system we have today. and we can begin the next century with the new approach. The logical question is: What approach do I favor and the sponsors. the 47 of us who sponsored this legislation in the House. H.R. 2483? Some of us make choices and take sides in the debate: Should it be a sales tax or flatrate income tax or any other tax? I do not. I think any system. just about any system. is better than the one we have today. H.R. 2483 sunsets the code effective December 31. 2000. protects Social Security and Medicare. We do not touch the funding of those two systems. But it gives the American people an opportunity that is all too rare in this country. one that we are trying to do more of in this new Republicandominated Congress: Give them. the American people. our employers. the opportunity to be involved in changing the tax system. I am excited about this. I think this is an opportunity for the Members of this House and of the other body to look at the American people and say. we are going to shoot the gun to begin the race. We set the goal line down there. but we are going to let you determine how that race is run. We want the American people to come forward with their ideas on reforming. fundamental reform of the Tax Code. We want their ideas on whether they support a flatrate income tax. a national sales tax. or some other form of taxation. But the important thing is beginning this debate and this race. I am hopeful that this Congress will consider H.R. 2483 and our Senate companion bill this year. If we do so. that will give us 3 years to involve the American people in this dialog on the fundamental change we want to undertake. It will also give us 3 years to ponder what kind of country do we want moving into the next century. Do we want one that is driven by Washingtonmandated dictates?-Do we want one where we in this Congress or bureaucrats or Federal agencies determine outcomes for our families or our businesses or our futures? Or. on the other hand. would we rather have a system of taxes that allows the greatness of this country to flow from the American people. not from Washington. DC? Will we want a Tax Code that allows entrepreneurs and small businessmen and women to achieve all the success they want in their lives? Will we have a systemthat will allow people to employ their friends and their neighbors and relatives and people down the street in their businesses. creating more hope and growth and opportunity across the country? I think that this issue of fundamental sweeping tax reform. setting aside the current Tax Code with a new system of fairness. combined with our effort to balance the budget and to stay the course on controlling wasteful Washington spending." these will give my little 16monthold daughter Suzie and children across this country like her the opportunity to live and work in .what will again be in the next century the great Nation that we have been in this century. There are many other challenges we are going to face as a country. If we can solve problems like the deficit that we have been running up. address the debt issue. which the gentleman from Wisconsin in this Chamber is working so tirelessly to do in his legislation to be able to pay down our Nations indebtedness so we are not burdening the future generations with that indebtedness that we are running up today. and if we can fundamentally change this Tax Code. throw it out. come up with a system that unleashes the greatness of this country. I think the best days of this Nation are truly ahead of us. I look forward to working with my colleagues as we see this issue to fruition.