The IRS would suffer a significant budget cut, but more of its available money would be diverted to improving customer service, under a spending bill drafted in the House.
A bill to be considered by a House Appropriations subcommittee on Thursday would provide $10.1 billion for the IRS, $838 million below the current level and $2.8 billion below President Obama’s request for the 2016 fiscal year.
“This funding level is sufficient for the IRS to perform its core duties, but will require the agency to streamline and better prioritize its budget,” the Appropriations Committee said in a summary.
Of that amount, $2.2 billion – $75 million above current levels – would be designated “to measurably improve the rate that IRS answers telephone calls and correspondence from taxpayers.”
The IRS itself has called its customer service “abysmal,” blaming past budgetary restrictions for taxpayers suffering long waits for help in person, by mail or on the phone — if that help is provided at all.
The National Taxpayer Advocate and other independent bodies overseeing the IRS have blamed understaffing for degraded customer service, as has the National Treasury Employees Union, which represents many IRS employees.
In a letter to the subcommittee sent Wednesday, NTEU president Colleen M. Kelley said that the bill’s funding levels “will further degrade [the IRS’s] already impaired ability to provide taxpayers with the assistance they need and fairly enforce the tax laws.” Enforcement efforts would suffer, resulting in lost revenue, as would programs to combat identity theft-related tax fraud, she wrote.
The draft measure for the budget year that starts in October also reflects continued fallout from the scandal over the agency’s handling of requests for tax-exempt status. It would prevent proposed rules on that issue from taking effect, and would bar the IRS from targeting groups for regulatory scrutiny based on their ideological beliefs or from targeting individuals for exercising their First Amendment rights.
The bill further would prevent the IRS from enforcing the individual insurance mandate under the Affordable Care Act.
Also included are several provisions targeting IRS employees. Current employees would be ineligible for awards or other types of cash payments unless their conduct and compliance with tax laws are considered; a similar bar would apply to paying incentives when rehiring former employees.
The bill, the financial services-general government measure, typically is the vehicle through which Congress sets or denies a federal pay raise for the following year. The measure is silent on a raise, continuing a strategy Congress has followed for the last two budgetary cycles of allowing the White House’s proposed amount take effect by default but requiring agencies to absorb the cost out of general overhead accounts. President Obama has recommended a 1.3 percent increase for January 2016.
However, the bill does specify that any increase that is paid would not apply to political appointees or to political senior executives; under a separate spending measure that already has passed the House, members of Congress would not receive a raise in 2016.