[Congressional Record Volume 144, Number 56 (Thursday, May 7, 1998)]
[Senate]
[Pages S4462-S4466]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     INTERNAL REVENUE SERVICE RESTRUCTURING AND REFORM ACT OF 1998

  The Senate continued with consideration of the bill.
  Mr. BROWNBACK. I am afraid, Mr. President, my speech is far more 
pedestrian. It is about taxes. When you think of it in the context next 
to motherhood, it pales substantially, yet it is the business of this 
body.
  The bill we are on today is about taxes, and it is about reforming 
the IRS. I think the chairman of the Finance Committee has done 
extraordinary work on bringing this topic to the floor, and I am going 
to support it. I think it is an important measure to us and for the 
Republic.
  I rise to speak for a few minutes on the need not only to reform the 
Internal Revenue Service but to change the way our Government is 
financed. During consideration of the budget resolution, just a short 
month ago, the Senate voted not only for the need to make some basic 
changes in the IRS but also the need to sunset the Tax Code.
  It is a sad and easily recognizable fact that big government 
advocates have socially engineered our culture into the ground through 
the use--and abuse, I might add--of the power to tax. To save our 
culture, we must at once not only recognize and support those entities 
in the culture that help us, but also remove the ability of Government 
to discriminate against institutions that help us, as well. For 
instance, the marriage penalty; we have a tax on being married. If you 
are married, you get taxed more than if you just live together. That is 
wrong. That is harmful to society. It is harmful to the culture and 
needs to be removed. We promote, also, gambling in the Tax Code.
  In short, we must cut back on Government's micromanagement of our 
lives, and particularly those areas that create vice and hinder and 
hurt our Republic and our Nation and our culture. This is a Tax Code 
that we have today that will go down in history as one of the most 
onerous burdens ever placed on the American people. I am convinced that 
we cannot have another American century with this Tax Code. It is 
antifamily. It is antigrowth. It cannot be saved. It must be scrapped.
  But in the meantime, we must try to correct for some of the well 
documented cases of abuses that were given life by this Tax Code and 
were brought to light by the Senate Finance Committee. The IRS needs to 
be reformed as much as the code that has given it unprecedented power 
needs to be put to rest. Americans demand reform of our Tax Code as 
well as the agency charged with enforcing it. We have promised that 
reform. Now, during the course of this bill, we must begin to deliver 
on that promise to the American people.
  I believe we need to stay focused on where the problem really lies.

[[Page S4463]]

  In order to make this point, I have a horror story from Kansas--not 
that everybody doesn't have one from their home State, actually many of 
them coming forward--that involves an older couple--the husband is 
nearly 70 years old--running a small business from their home. In the 
mid-1980s, they were selected for an IRS audit that focused heavily on 
home office deductions and related expenses and resulted in the 
assessment of additional taxes, penalties, and interest. The 
constituents have made payments on the back taxes, but in so doing, 
they limited their ability to make their current estimated tax 
payments. So the IRS said, ``Stop making your back tax payments and 
let's get caught up on your current estimated taxes.'' The constituents 
told them they would do that. But they were told, as well, that the IRS 
would put a hold on the collection of their back taxes until they were 
caught up on their current estimated taxes. The IRS said, ``OK, we will 
put a hold on collecting your back taxes. You get caught up on the 
estimated current taxes.'' However, the IRS failed to inform the 
constituents that interest on the back taxes would continue to accrue.

  Now, the outstanding principal balance my constituents owed was 
$18,000. However, when the penalty and accrued interest are added, the 
amount balloons to $46,000--from an $18,000 back tax to $46,000 in 
interest and penalties. My constituents have offered to pay $18,000. 
They believe that they might be able to come up with that with loans 
from friends and relatives. However, the IRS cites the constituents' 
equity in their home as a source of income that could be used to settle 
the entire debt, but they need to sell their home or otherwise 
refinance in order to be able to get the equity to pay off this bad tax 
debt.
  Unfortunately, because of the situation with the IRS, the IRS has put 
a lien on their home. And, in fact, in this era of declining interest 
rates, my constituents have been forced to pay over 10 percent interest 
rates because the lien precludes them from refinancing at lower rates, 
possibly as low as 7 percent. Therefore, again, my constituents are 
making very high house payments, which squeezes their budget even 
tighter, which limits their ability to pay their back taxes and 
interest due to the IRS or the current estimated taxes due to the IRS.
  If my constituents were to sell their home, their age would likely 
preclude them from generating enough income to purchase another home. 
The IRS has even garnished their Social Security retirement income. 
Social Security benefits comprise the bulk of their income. They are 
still trying to reach a settlement with the IRS. In trying as hard as 
they can to make this payment, they are getting squeezed and boxed in 
by this IRS and by this code. This is just another horrible example of 
the IRS in the Catch-22 situation that is forced upon many Americans. 
It must be put to a stop. This cannot continue.
  The underlying problem, though, along with the IRS enforcement, is 
the Tax Code. Not only does our Tax Code undermine the basic building 
blocks of our society, the family, it also punishes good investment 
decisions and distorts the labor market as well as our rates of 
national savings are distorted by this Tax Code. It manipulates 
behavior by adding an incentive to do one thing while punishing those 
who would do something else.
  A quick look at some of the inadequacies in our code should make the 
case for reform clear. For example, if you are a gambler, you can 
deduct your gambling losses against your winnings. But if you are a 
homeowner and you happen to make a bad home investment, and the value 
of your home declines, you have no recourse in the Tax Code because you 
cannot claim a deduction for the capital loss. Now the question really 
is--think about this--should we allow for a bad game of blackjack to be 
deducted but not a bad home investment which you were building a family 
around? Does this make sense to anybody? I don't think so.
  The code is full of these inconsistencies, like the one I just 
mentioned. Sure, we can try to fix the problems within our Tax Code, 
and we should, but the fact of the matter is, our Tax Code is riddled 
with these inconsistencies. It is micromanagement to the greatest 
degree, which leads to the conclusion that we cannot reform this code. 
We have to sunset it and go to one that is simpler, better, and fairer. 
We must move to a tax system where individuals are not punished for 
getting married, for saving for their children's education, or for 
other investments, where the national rate of savings is not distorted 
by these unintended consequences. This current Tax Code doesn't make 
sense. It is unintelligible. It has 10 million words and it has to be 
gotten rid of.

  We should go to a tax system that does not discriminate against the 
components of growth in our economy or the family. Some will disagree. 
But this is the precise issue upon which we must focus our debate. We 
must decide where we want the tax to be imposed; and further, we must 
understand what effect the imposition of the tax will have on the 
health of the economy. We need to go to a progrowth, profamily taxation 
system.
  Mr. President, we are soon going to have a debate on replacing this 
Tax Code. I have spoken with the majority leader and he agrees with the 
need to bring this up during the Treasury-Postal debate. We will have a 
full debate about replacing and sunsetting this Tax Code and going to 
one that is simpler, fairer, and better.
  It is time to have this debate. We voted previously in the Senate on 
a sense-of-the-Senate resolution to sunset this Tax Code by the end of 
the year 2001 and start the great national debate now about what we 
should replace this riddled code with. That is what we should do--
figure out what we are going to replace it with and set the time line 
that by this date we will have a new code. It may take 15 years to 
implement it. We are going to have to do some phasing in doing it. But 
it is time to start the great debate on this. Reform is important. 
Reforming the IRS is critical. The next step is reforming the IRS code, 
the law. We will vote on sunsetting it and start this great national 
debate of going to a different system so that we can have another 
American century, an unlimited America. We can't with this code. We can 
and we must do better.
  With that, I yield the floor.
  Mr. GRAMS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Minnesota is recognized.
  Mr. GRAMS. Mr. President, first, I thank the Senator from Idaho for 
allowing me to break in here to give a 5-minute speech dealing also 
with what Senator Brownback is talking about, which is really the 
unfairness of the current Tax Code that we have.
  Mr. President, I am usually not one to quote poetry here on the 
Senate floor, but I rise today and ask my colleagues' indulgence as I 
broach a serious subject with a not-so-serious bit of rhyme.

       Abracadabra, thus we learn
       The more you create, the less you earn.
       The less you earn, the more you're given,
       The less you lead, the more you're driven,
       The more destroyed, the more they feed,
       The more you pay, the more they need,
       The more you earn, the less you keep,
       And now I lay me down to sleep.
       I pray the Lord my soul to take
       If the tax-collector hasn't got it before I wake.

  Mr. President, it was 1935 when poet Ogden Nash took up his pen to 
warn of the dangers of a tax system run amuck. Then, the federal tax 
rate topped out at less than 4 percent.
  Sixty-three years later, Washington now demands 28 percent of every 
paycheck; the additional burden of state and local taxes boosts the 
total tax load to nearly 40 percent of every worker's paycheck.
  I cannot say with certainty what sort of poem Mr. Nash might produce 
on the subject were he alive today, but it would not surprise me if it 
could not be repeated here on the Senate floor.
  There exists no other date the American people await with such dread 
as April 15, tax filing day. Rightfully so. Oppressive taxes, coupled 
with abuses the Internal Revenue Service routinely carries out upon 
taxpayers--abuses exposed during the recent hearings of the Senate 
Finance Committee--certainly highlight the reasons why.
  Yet, taxpayers face another annual event they should look upon with 
equal disdain, an event that reveals a great deal about the federal, 
state, and local tax burden working families are expected to bear: Tax 
Freedom Day.

[[Page S4464]]

  As it does every year, the nonpartisan Tax Foundation has calculated 
the date average American stops working just to pay their share of the 
tax burden and begin working for themselves and their families.
  In 1998, Tax Freedom Day falls on Sunday, May 10. That means 
taxpayers must work 129 days before they can count a single penny of 
their salary as their own--that is a full day later than 1997, and 
marks the latest-ever arrival of Tax Freedom Day.
  By the time Tax Freedom Day arrives, the American people will have 
spent the last 129 days imprisoned by their own tax system. And that is 
not the whole picture, because if the cost of complying with the tax 
system itself were included in the calculations, Tax Freedom Day would 
be pushed forward another 13 days. As proof of just how far we have 
traveled--in the wrong direction--Tax Freedom Day in 1925 arrived on 
February 6.
  Taxpayers are now working more than an entire week longer to pay off 
their taxes than they were when President Clinton first took office in 
1993. Calculate the tax load in hours and minutes, instead of days, and 
Americans spend fully two hours and 50 minutes of each eight-hour 
workday laboring to pay their taxes.
  While May 10th marks the arrival of Tax Freedom Day for taxpayers in 
an average state, many Americans are forced to wait longer. My home 
state of Minnesota, for example, is the third highest-taxed state, and 
our taxpayers will not mark Tax Freedom Day until May 16, nearly a week 
later. If you live in Wisconsin or Connecticut, you will wait even 
longer.
  After 16 major tax increases over the past 30 years, the need for tax 
relief has never been more pressing.
  Congress and the President moved toward the taxpayers in 1997 by 
enacting the ``Taxpayer Relief Act'' with its $500 per-child tax 
credit. In 1998, Congress and the President can and must do more, 
beginning with fundamental reform of the entire tax system. Merely 
tinkering around the edges of the Internal Revenue Service won't reduce 
the burden on overtaxed Americans, though. Real reform means creating a 
more sensible way to pay for the services of government through a 
system that is flatter, simpler, fairer, and treats the taxpayers with 
respect. Meaningful tax relief--relief that leaves more dollars in the 
hands of working Americans to spend on child care, health insurance, 
clothing, and groceries--will quickly follow.
  Instead of serving as yet another occasion for tabulating the high 
cost of government, Tax Freedom Day must become a national call to 
action. How far will it go if the taxpayers do not step forward? To 
paraphrase Mr. Nash: Abracadabra, thus we say Just where is the 
``freedom'' in Tax Freedom Day? I yield the floor.
  Mr. CRAIG addressed the Chair.
  The PRESIDING OFFICER. The distinguished Senator from Idaho is 
recognized.


             Amendments Nos. 2364, 2365, and 2366, en bloc

  Mr. CRAIG. Mr. President, I send three amendments, en bloc, to the 
desk and ask for their immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Idaho [Mr. Craig] proposes amendments 
     numbered 2364, 2365, and 2366, en bloc.

  Mr. CRAIG. Mr. President, I ask unanimous consent that reading of the 
amendments be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments are as follows:

                           Amendment no. 2364

     (Purpose: To require advance notification to taxpayers before 
 disclosure of their income tax return information to state and local 
                              governments)

       Insert in the appropriate place in the bill the following:

     SEC.  . TAXPAYER NOTICE.

       Section 6103(d) of the Internal Revenue Code of 1986 is 
     amended by adding at the end thereof a new paragraph to read 
     as follows:
       ``(6) Taxpayer notice.--No return information may be 
     disclosed under paragraph (1) to any agency, body, or 
     commission of any State (or legal representative thereof) 
     unless the Secretary determines that such agency, body, or 
     commission (or legal representative) has first notified each 
     person for whom such return or return information was filed 
     or provided by, on behalf of, or with respect to, personally 
     in writing that the request described in paragraph (1) has 
     been made by such agency, body, or commission (or legal 
     representative) and the specific reasons for making such 
     request.''.
                                  ____



                           Amendment no. 2365

    (Purpose: To limit the disclosure and use of federal tax return 
  information to the States to purposes necessary to administer State 
                            income tax laws)

       Insert in the appropriate places in the bill the following:

     SEC.  . DISCLOSURE NECESSARY IN THE ADMINISTRATION OF STATE 
                   INCOME TAX LAWS.

       (a) Section 6103(b)(5)(A) of the Internal Revenue Code of 
     1986 is amended by inserting after ``Northern Mariana 
     Islands,'' the following: ``if that jurisdiction imposes a 
     tax on income or wages,''.
       (b) The first sentence of Section 6103(d)(1) is amended by 
     inserting the word ``income'' after ``with responsibility for 
     the administration of State'' and before ``tax laws''.
       The first sentence of Section 6103(d)(1) is further amended 
     by inserting ``State's income tax'' after ``necessary in, the 
     administration of such'', and before ``laws''.
                                  ____



                           Amendment no. 2366

 (Purpose: To require disclosure to taxpayers concerning disclosure of 
  their income tax return information to parties outside the Internal 
                            Revenue Service)

       Insert in the appropriate place in the bill the following:

     SEC.  . DISCLOSURE TO TAXPAYERS.

       Section 6103(d) of the Internal Revenue Code of 1986 is 
     amended by adding at the end thereof a new paragraph to read 
     as follows:
       ``(6) disclosure to taxpayers.--The Secretary shall ensure 
     that any instructions booklet accompanying a general tax 
     return form (including forms 1040, 1040A, 1040EZ, and any 
     similar or successor forms) shall include, in clear language, 
     in conspicuous print, and in a conspicuous place near the 
     front of the booklet, a complete and concise description of 
     the conditions under which return information may be 
     disclosed to any party outside the Internal Revenue Service, 
     including disclosure to any State or agency, body, or 
     commission (or legal representative) thereof.''.


                    Amendment No. 2364, As Modified

  Mr. CRAIG. Mr. President, I ask unanimous consent that amendment 2364 
be modified, and I send that modification to the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 2364), as modified, is as follows:

                    amendment no. 2364, as modified

     (Purpose: To require advance notification to taxpayers before 
 disclosure of their income tax return information to state and local 
                              governments)

       On page 394, after line 15, add new item 5 to read as 
     follows:
       ``(5) Whether return information should be disclosed under 
     Section 6103(d) of the Internal Revenue Code of 1986 to any 
     agency, body, or commission of any State (or legal 
     representative thereof) unless the Secretary determines that 
     such agency, body, or commission (or legal representative) 
     has first notified each person for whom such return or return 
     information was filed or provided by, on behalf of, or with 
     respect to, personally in writing that the request described 
     in section 6103(d) of the Internal Revenue Code of 1986 has 
     been made by such agency, body, or commission (or legal 
     representative) and the specific reasons for making such 
     request.''.

  Mr. CRAIG. Mr. President, before I discuss these three amendments en 
bloc, let me say, as so many of us have on the floor over the last 
several days, how proud we are of Senator Bill Roth for the very 
statesmanlike approach he has taken toward major reform of the Internal 
Revenue Service. His committee, the Finance Committee of this Senate, 
and the hearings he has held with the full participation of Democrats 
and Republicans alike in most instances, is producing the first 
significant reform in the IRS in its history in well over 200 years. We 
are reversing a trend that over 200 years progressively took away from 
the average citizen, the taxpayer, more and more of their rights as 
individuals, their personal power upon themselves, and their own 
financing. So what we do here today and what we have been doing for 
several days is phenomenally significant. I am tremendously proud of 
our chairman, Bill Roth, and the statesmanlike approach he has taken.
  Let me also say that the leadership of our majority leader, Trent 
Lott, has also helped to cause this to happen. He has supported our 
chairman and insisted that we move this along in a timely fashion. Of 
course, I am pleased that the American public is supportive of what we 
are doing. They know more than anyone else the importance of the 
reforms that we are debating.
  While this is a major step taken forward, my three amendments touch 
on

[[Page S4465]]

an area that really has not gone overlooked but is very seldom talked 
about; that is, taxpayer privacy and disclosure of taxpayer 
information. It is probably one of the more important areas. And it is 
something that a lot of our citizens simply don't know a great deal 
about. They assume, and you and I assume, Mr. President, that our 
information, our forms, our files at the IRS are very, very private. 
They are not. For the next few moments let me explain why they are not, 
and why my three amendments would make a major effort to correct that.
  While the citizens of our country believe that the agencies of the 
Federal Government responsible for collecting and administering our tax 
laws will hold their information confidential--and I think they have 
been led to believe that over the years--it just simply is not the 
case.
  I was stunned when I found out that under the Internal Revenue Code 
and the IRS regulations all it takes is one simple letter from State 
tax officials to get the IRS to turn over to thousands of officials 
across the Nation millions of pages of citizen returns. Those citizens 
have no way of finding out that their returns have been passed on in 
whatever manner. Does the IRS tell them? No. It doesn't. Does it state 
to them that at least they have been turned over to the State? Or does 
the State notify them that they are in possession of their Federal tax 
records? Again the answer is no. It doesn't tell them. You and I, Mr. 
President, would like to think that those are our private records. We 
know, as every citizen knows, that they are the most disclosing of all 
financial information that any citizen ever provides. And it is all 
considered, at least by the citizen, confidential.
  The evidence is very clear that there could be abuse. We don't know 
at this moment whether there has been State or local abuse. I say local 
abuse because we know that cities that have income taxes also can have 
made available to them those citizens' Federal IRS returns referenced. 
So what we don't know is where the abuse is occurring. What we do know 
is that these are released.

  More than 60 jurisdictions under section 6103 of the Internal Revenue 
Code are allowed to have access, all 50 States, the District of 
Columbia, Commonwealth and territories, plus all of the cities with 
income taxes and with populations of over 150,000. It is true that 
section 6103 of the code prohibits sharing tax return information--
Watergate style, that is--with Governors and mayors. Or shall I say 
political individuals? But then you and I know, Mr. President, that in 
some of our States there still lurks and there always will lurk the 
``good ole boy'' system.
  Who appoints the tax commissioner in the State? Very few are elected. 
The Governor does. Who has access to all of these files? The tax 
commissioner does. If I want to know something about an individual, and 
I am a Governor, or I am a mayor of the so described cities, is it 
impossible to get that information? Let me tell you. There is a law 
against doing that. But we know that law has not been enforced, or we 
know that in many instances. Who would ever find out? Do we have 
Federal agents at State collection agencies ensuring the security and 
the confidentiality of those thousands of records they have passed 
forward? No. Absolutely not. We couldn't afford it if it were the right 
thing to do.
  So what I am suggesting in my amendments is that we change the 
behavior, change the attitude. Drug dealers, child molesters, and 
organized crime individuals have more protection outside of the Tax 
Code than the average citizen has inside the Tax Code.
  Frankly, I am amazed that this type of sharing of confidential tax 
information has not been found to be an unreasonable search under the 
fourth amendment of the Constitution.
  I want to stress that this information is not passed along only in 
cases in which an individual is under investigation by a State or a 
local tax agency. One routine request will provide detailed computer 
tapes on virtually all of the taxpayers in that State. Then computers 
can be used to scan the tapes for any item of information that the 
State or the local officials think may indicate ``fishy behavior,'' or 
the tax return information of selected individuals may be accessed. And 
the taxpayer, again, let me repeat, is never told that his or her 
records are being passed around in the character and in the nature 
which I have described.
  What kind of confidential taxpayer information can be passed around 
so freely? I was astounded to find out how much. The kind of 
confidential tax information being handed out includes the taxpayer's 
annual tax returns, information returns, declarations of estimated 
taxes, claims for refunds, amendments, supplements, and supporting 
schedules and attachments. Worse yet, many types of information can be 
passed around simply because they are called return information. This 
can include the taxpayer's identity, the nature, the source, and the 
amount of income, any payments or receipts in the IRS files, and any 
deductions you may have taken. From that type of information it is 
possible to figure out what kind of house the taxpayer lives in, the 
amount of the debt that taxpayer has, if you are sick, if you are not 
sick. The confidential taxpayer information being passed around 
includes your net worth, your tax liability, any deficiencies in tax 
payments you have and the like. It gets worse. It doesn't get better 
because there are a lot of things in those files.
  The confidential information shared includes any data received or 
prepared by the IRS regarding a return deficiency, penalties, interest, 
offenses, and the like. It includes any information regarding actual or 
possible investigation of a return. And it also includes any part of an 
IRS written determination or background file document not opened to 
public inspection.
  Now, remember, I just said information not open to public inspection 
that can be sent out across the country to any lesser tax collecting 
agency. It may even include an incorrect or an unfavorable credit 
report, a report which under any other circumstance you could access, 
dispute, and correct.
  Generally, however, taxpayers do not have access to their own IRS 
files. Therefore, you, the taxpayer, have no way of checking the 
accuracy of the information or refuting incorrect information that may 
be passed back and forth freely amongst several levels of government.
  The bundle of amendments I have offered today does several things. My 
first amendment would advance the idea of not allowing this kind of 
confidential information to flow forward. I understand that States that 
have income taxes use the IRS code and its information to shape and 
define their own taxpayers, and I understand that if we were to stop 
that immediately it could cause grave impact on State tax collecting 
agencies. So what I have asked in this amendment, in the modification 
that I sent to the desk, is that we review through the study within the 
proposed law that we are debating now of 6103, that we look at this as 
a part of a study to see how we can shape the assurance of 
confidentiality, as information in some instances probably must flow to 
other tax collecting agencies. And I hope we can accept that. It is a 
study to begin to look at assuring confidentiality in an area that, 
very frankly, the committee did not take a lot of time looking at.
  The second amendment would limit the sharing of tax return 
information with States or local governments to circumstances in which 
its disclosure and use is necessary to administer a State or local 
income tax. So we are talking exclusively of an income tax calculation, 
not, if you will, the broad search for information.
  Under careful examination of section 6103, I noticed that large 
cities, as I mentioned, would receive confidential tax information only 
if they impose their own city income tax. So we want to limit it to 
just those cities that have an income tax. But States, the District of 
Columbia, territories, and Commonwealths could receive detailed, 
voluminous information on income tax returns as long as they assure the 
IRS that the information is somewhat related to State tax law; in other 
words, we want to make it specific: States, governments, local 
jurisdictions that have income taxes as a part of their revenue 
collecting and therefore to be very specific so that States that do 
not, cities, large cities of over 225,000 that do not, cannot request 
it because the law would deny, or allow the IRS to deny that kind of 
request of these

[[Page S4466]]

very large volumes of confidential information.
  Amendment two would shape that and limit it. In short, this amendment 
simply says income tax information should only be shared for a relevant 
purpose--for income tax purposes, period. It would treat States and 
other jurisdictions the way the Tax Code already treats the larger 
cities. This amendment represents a modest first step toward better 
protection for taxpayer privacy.
  The third amendment requires the IRS to publish a reasonable 
disclosure to all taxpayers in the instruction booklets already 
accompanying the basic Federal income tax returns. This would simply be 
an explanation to the taxpayer in clear language, in conspicuous print, 
one page, in the front of the information booklet, the conditions under 
which the taxpayer's tax return information may be shared with any 
other party outside the IRS.

  In other words, it puts the taxpayer on notice that here is the limit 
and this is information they simply did not know before. I firmly 
believe that virtually none of America's taxpayers realize just how 
public their private tax records are. The very least we owe them is to 
disclose up front the circumstances under which their information will 
be shared. This would also assure them of the extent, however limited, 
to which their privacy is protected. This disclosure also should result 
in increased compliance with State and local tax laws since taxpayers 
will be reminded up front as they prepare their Federal return that the 
same information may be shared for State or local compliance purposes. 
Surely, the IRS can do this for its taxpayers. Taxpayers who will send 
$1.7 trillion this year to the Treasury of this country deserve to have 
a clear, one-page explanation of the extent to which their privacy is 
protected.
  Let me repeat that. One page of information, that is all it takes, in 
the front of the information book that goes out to every taxpayer. I do 
not want the regulators downtown to decide that it takes an entirely 
new book with multiple pages saying blah-blah-blah, blah-blah-blah. We 
want the taxpayer to know the circumstances and those who can receive 
this very private and very confidential information. So that is what 
should happen, and I believe these are amendments Congress should 
accept as we move to reform the IRS code.
  Mr. President, I urge adoption of amendment 2364, as modified, and I 
ask to set aside for the time being amendments 2365 and 2366.
  The PRESIDING OFFICER. Is there an objection? Without objection, it 
is so ordered.
  The amendment (No. 2364), as modified, was agreed to.
  Mr. CRAIG. Mr. President, again, I applaud my chairman, Bill Roth, 
for the leadership he has brought on this most significant of issues. 
As I say, it is fun to be a part of rolling back 200 years of 
accumulation of assault on the American taxpayer that clearly this 
Senate is acting upon now in this major reform of the IRS. Of course, 
to our majority leader, and to all who have joined in the Finance 
Committee, it is especially important that we do this.
  So I hope that the disclosures I am talking about, the limitations as 
they relate to privacy and the confidentiality of this information can 
become a part of that reform. And then, of course, the other, an 
intense study to understand how far we can go and how we can work with 
income-tax-collecting State agencies and cities to assure even greater 
confidentiality is so very important.
  With those comments, I yield the floor. I note the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. THOMAS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. THOMAS. I ask unanimous consent to speak for 6 minutes as in 
morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator is recognized.
  Mr. THOMAS. Thank you, Mr. President.

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