[Congressional Record Volume 143, Number 151 (Monday, November 3, 1997)]
[Senate]
[Page S11588]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                               IRS REFORM

  Mr. GRAMS. Madam President, before we vote on IRS Commissioner 
nominee Charles O. Rossotti, I'd like to take this opportunity to make 
a few remarks about the direction IRS reform should take.
  But first let me commend Mr. Rossotti for his courage to take on this 
job. I believe with his expertise and experience in private business 
management, Mr. Rossotti is qualified to head the agency, and I am 
confident that he will help improve IRS services and management.
  Madam President, the American people have every right to be outraged 
by the disturbing details that emerged during 3 days of Senate hearings 
into the tax collection practices of the IRS.
  Testimony from taxpayers and current and former IRS officials 
provided chilling accounts of mistreatment, abuse of power, and the 
merciless trampling of citizens' rights. What's even more shocking is 
that these improper and illegal practices within the IRS aren't random 
occurrences--they happen regularly.
  For decades, IRS agents have routinely snooped through the supposedly 
confidential tax files of thousands and thousands of Americans. That 
could include me, or you. IRS agents are evaluated and promoted based 
on their total tax collections, a practice outlawed a decade ago.
  IRS managers often cover up abusive behavior by collection agents. In 
stark contrast to our legal system, all alleged tax debtors are assumed 
guilty and treated as criminals.
  The distressing tales told by the Senate witnesses were hardly 
isolated incidents; hundreds of working, law-abiding Minnesotans have 
contacted my office with similar grievances.
  Though the individual details of their stories vary, the message is 
the same: the IRS devastated their lives. Many lost their homes, cars, 
businesses, and professional licenses--not to mention their reputation 
and self-respect.
  Congress established the IRS with good intentions but the agency has 
evolved into what Nobel laureate Dr. Milton Friedman labels ``a self-
generating monstrosity over which the people have little control.''
  As a result, our tax system has become extremely complicated, 
difficult even for IRS experts to understand, and our tax burden has 
become so heavy and so unfair that it's unbearable for many working 
Americans.
  The tax system under which the IRS operates today has become a 
redistributor of private incomes, a mechanism to enforce social re-
engineering, and a launch pad for class-warfare.
  It is anti-family. It destroys economic opportunity, hinders our job 
creation, impedes productivity and retards competitiveness. It has 
deepened the despair and disaffection among the poor and disadvantaged. 
It encourages abuse, waste, and corruption.
  Congress deserves much--if not most--of the blame for the abuses of 
our current tax system because it is Congress that writes the Tax Code 
in the first place.
  There are now nearly 10,000 pages of Tax Code, 20 volumes of tax 
regulations, and thousands and thousands of pages of instructions.
  Besides making the tax system so complicated, Congress has seriously 
neglected its oversight responsibilities over the IRS. In fact, the 
Senate hearings were the first formal oversight of the agency ever 
conducted by Congress. That in itself is very shocking.
  Congress for decades has been passing new tax laws and regulations 
without looking back to see how the system has been affected, or if 
it's working, or if it's unfair.
  It's more obvious than ever that the present tax system will fail to 
lead us into the next century without fundamental reforms. But can 
Washington fix the IRS problems it created? Yes--if Washington can 
muster the political will to do it.
  The first thing Congress must do is take its oversight responsibility 
of the agency more seriously. Let's end the secretive ways of the IRS 
and open the process to the sunlight.
  Let's put the IRS under strict scrutiny, periodically reviewing its 
operations, exposing abuses, and ending illegal practices.
  I welcome the fact that President Clinton changed his mind and 
presented a plan aimed at improving taxpayer-assistance services at the 
IRS, including a board with private citizens to oversee the agency.
  Although this is a positive step, the proposed changes are mostly 
cosmetic and will do nothing to address the deep-rooted deficiencies 
within the IRS. Very simply, the heart of the problem with the IRS is 
the tax policy on which all IRS decisions are based.
  To end the abuse once and for all, Congress must pass new legislation 
to reform our tax system and replace the ever-more-complicated Tax Code 
with one that's simpler, fairer, and more friendly to taxpayers.
  The American people deserve a fair Tax Code that promotes harmony 
between people and doesn't separate us into classes, a code that 
encourages work and savings; a code that rewards families and success 
rather than penalizes them; a code that stimulates real economic growth 
and produces more jobs and, yes, higher tax revenues; a code that 
allows taxpayers to keep more of their own money.
  Congress must explore every available solution in our quest to re-
create our tax system and achieve these objectives.
  Passing the House IRS bill may sound tempting, as it does make some 
needed changes, but I agree with Senator Roth that we need to do the 
job right the first time around, not accept minor changes that may 
prevent or delay efforts to reform our overall tax system.
  Madam President, the leadoff witness at the Senate IRS hearings 
summed up the debate with a message Congress cannot ignore: ``If the 
public ever knew the number of abuses covered up by the IRS, there 
could be a tax revolt.''
  The public is beginning to understand the depth of the IRS problems. 
Tinkering with the IRS won't work and the time for real tax reforms is 
now.
  Thank you very much. I yield the floor.
  Mr. GRAMM addressed the Chair.
  The PRESIDING OFFICER. The Senator from Texas is recognized.
  Mr. GRAMM. Madam President, I yield myself such time as I might use 
off the leader's time.
  The PRESIDING OFFICER. Is there objection? The Chair hears none, and 
it is so ordered.

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