IRS's appropriation for tax systems modernization.

• Position: Tax Executives Institute

On June 14, 1994, Tax Executives Institute submitted the following comments to the Senate Appropri on the Clinton Administration's appropriation request for the Internal Revenue Service's tax systems initiatives. The comments, which took the form of a letter from TEI President Ralph J. Weiland to Se chairman of the Appropriations Committee, were filed after the House Appropriations Committee reduce approximately half a billion dollars.

On behalf of Tax Executives Institute, I am writing to urge the Senate Appropriations Committee, and Congress as a whole, to restore critical funding at the Internal Revenue Service for its tax system modernization (TSM) program. Adequate funding of TSM is essential to the IRS's efforts to "reinvent itself" and otherwise operate in a manner that imposes fewer burdens on American tax-payers.

Tax Executives Institute is the principal association of business tax officials in North America. The Institute's nearly 5,000 members work for the 3,000 largest companies in the United States and Canada. TEI is dedicated to the development and effective implementation of sound tax policy, to promoting the uniform and equitable enforcement of the tax laws, and to reducing the cost and burden of administration and compliance to the benefit of taxpayers and government alike. The Institute is committed to maintaining a tax system that works ae one that builds upon the principle of voluntary compliance, is consistent with sound tax policy, one that taxpayers can comply with, and one in which the IRS can effectively perform its audit function without unduly burdening taxpayers.

TSM is the government's long-term strategy to modernize the IRS computer and telecommunications systems, which support both the administration of the tax laws and the operation of the IRS itself. The IRS's current information systems are based in large measure on 1960s technology and resemble nothing so much as a patchwork that cannot be expected to carry the tax system into the next century.

The last three Administrations (two Republican and one Democratic) have supported TSM as essential to reducing unnecessary costs, inefficiencies, and burdens on the tax collection process and on taxpayers generally. Thus, while there may be disagreements over specific facets of TSM, we believe there is a strong bipartisan consensus that the initiatives as a whole are necessary to foster voluntary compliance, reduce burden, and give taxpayers a tax system in which...