Bill would keep federal money from delinquent taxpayers

The House Government Reform Committee on Thursday approved bipartisan legislation that would render delinquent federal taxpayers ineligible for federal loans or contracts.

The "Debt Payment Incentive Act of 2000" (H.R. 4181), which the panel approved by voice vote, would modify the Debt Collection Improvement Act of 1996, which prohibits delinquent, non-tax debtors from obtaining federal loans or loan guarantees for education, housing and small business development.

The current law does not pertain to those who owe federal back taxes, and Rep. Steve Horn, R-Calif., who chairs the Government Management, Information and Technology Subcommittee, observed that the federal government is owed nearly $240 billion in back taxes. Nearly $50 billion of those debts are owed by about 2 million business owners who have collected payroll taxes from their employees but have not forwarded that money to the federal government.

"This is going to recover billions of dollars for the American taxpayer," Horn said of the bill. "Frankly, it's a disgrace that the matter was not dealt with years ago."

Before approving the bill, the panel adopted, by voice vote, an amendment by Rep. Jim Turner, D-Texas, the bill's chief sponsor. The amendment made technical changes to the legislation.