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Washington • The House this week unanimously passed a measure by Rep. Jason Chaffetz that would bar federal agencies from hiring or awarding grants to contractors with "seriously delinquent tax debt," but defeated another bill that would punish federal workers for the same concern.
Chaffetz, a Utah Republican and chairman of the House Oversight and Government Reform Committee, has pushed the two bills for years, arguing that tax money shouldn't be spent on those who are not current on their taxes. He heralded the passage of the contractor legislation.
"It is antithetical to use taxpayer resources to fund contractors who aren't fulfilling their own tax responsibilities," Chaffetz said in a statement. "This bill is a common-sense way to ensure that we prioritize law-biding taxpayers above those who are skirting their legal duty to pay taxes."
Chaffetz cited a Government Accountability Office report that found thousands of federal contractors owed substantial amounts of taxes, including about 27,000 defense contractors who owed a collective $3 billion to the government. Even more appalling, he said, were some 1,168 Internal Revenue Service contractors that owed $589 million in back taxes.
The congressman's legislation passed 424-0 on Wednesday, the IRS deadline for filing individual tax returns. Chaffetz's other bill would have allowed the government to fire workers with seriously delinquent tax debt – those who have a tax lien and without any agreement to pay back taxes – and prohibit the hiring of individuals who are in the same situation. The House voted 266-160 to support the measure but that failed to meet the two-thirds requirement to pass under a procedural move.
The congressman's office had previously noted that there are nearly 100,000 federal employees who owe more than $1 billion in back taxes.
"One, federal workers do a better job of paying their taxes than the general public, and we should pat them on the back, and we should recognize them for that," Chaffetz argued on the House floor. "But, two, when you do have a few bad apples, you have got to allow leadership the ability to let those people go if they continue to thumb their nose at the system and the taxpayers."
Some 27 Democrats joined 239 Republicans to support Chaffetz's measure on federal workers, though several Democrats have argued that – as Chaffetz pointed out – federal employees' tax compliance rate is higher than those who work for Congress and better than the general population.
"This legislation is designed to demonize federal employees rather than to help the government recoup delinquent taxes," said Maryland Rep. Elijah Cummings, the ranking Democrat on the Oversight Committee. "It is interesting to note that we want to collect the taxes, but we will never get them if we fire people."