The need for adequate funding of IRS: May 15, 2002.

• Author: Ashby, Robert L.

On May 15, 2002, TEI President Robert L. Ashby sent the following letter to Senators Byron L. Dorgan and Ben Nighthorse Campbell, the chairman and ranking member, respectively, of the Subcommittee on Treasury and General Government of the Senate Appropriations Committee, concerning the appropriations of the Internal Revenue Service for the fiscal year 2003. A similar letter was also sent to Congressmen Ernest J. Istook, Jr., and Steny H. Hoyer, chairman and ranking member of' the Subcommittee on Treasury, Postal Service, and General Government of the House Appropriations Committee. The letter was drafted under the aegis of the Institute's IRS Administrative Affairs Committee, whose chair is David L. Bernard of Kimberly-Clark Corporation.

On behalf of Tax Executives Institute, I urge the Treasury and General Government Subcommittee of the Senate Appropriations Committee to ensure that the Internal Revenue Service receives adequate funding for its fiscal year 2003 operations.

TEI's 5,200 members are accountants, attorneys, and other business professionals who work for the largest 2,800 companies in the United States, Canada, and Europe. TEI's members work on tax issues, and with the IRS, on a daily basis. They are responsible for conducting the tax affairs of their companies and ensuring their compliance with the tax laws. 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 system that works--one that builds upon the principle of voluntary compliance and 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.

For fiscal year 2003, the IRS is requesting approximately $10.4 billion in funding, an increase of about $500 million (or 5 percent) over its appropriated level for 2002. The largest component of the increase is $259 million to enhance customer service and compliance, of which $196 million will be funded through the redeployment of resources. (Using its strategic planning and budget process, the IRS has already identified internal savings to permit significant resources to be redirected to higher-priority areas.) Of critical importance is the $450 million...