WASHINGTON — As the U.S. government projects one of the largest deficits in history, their own employees owe more than $3 billion in federal income taxes from 2008.
On Wednesday, Rep. Jason Chaffetz, R-Utah, introduced a bill that could get federal employees who are delinquent on their taxes fired.
"We obviously have a problem," Chaffetz said. "We have nearly 100,000 people who are on the federal payroll and are not paying federal taxes. That's just not right."
If HR4735 passed, all federal employees labeled by the Internal Revenue Service as having "seriously delinquent tax debt" could be fired. The bill would also prohibit hiring applicants with the same tax status.
"This is not just the person who missed a payment," Chaffetz said. "These are the most serious offenders. They've gotten to the point where the IRS is having to put a lien on their property."
According to data from the IRS, the Office of Personnel Management and the Department of Defense, 100,000 federal civilian employees owe more than $962 million in unpaid federal income taxes from 2008. When retirees and military personnel are included, the number jumps to 276,000 people owing more than $3 billion.
The IRS already has this tax stipulation on employees and, perhaps consequently, has the highest rate of employee tax compliance among government agencies.
Some agencies have relatively few delinquents. In the Department of the Treasury, only .98 percent of employees owe from 2008. But in others, like the Department of Housing and Urban Development, more than 4 percent of employees owe back taxes. In the National Capital Planning Commission, more than 10 percent of employees owe from two years ago.
Despite those defaults, the number of federal employees earning more than $100,000 increased 46 percent from December 2007 to June 2009, according to USA Today, based data from the Bureau of Labor Statistics and the Office of Personnel Management. Employees making $150,000 and up more than doubled. During the same period, federal employment salaries increased 6.6 percent, while private sector and state and local government employees' salaries only climbed 3.9 percent. And while the private sector has watched 3 percent of jobs slip away since 2000, the executive branch has added 15 percent more jobs.
Last month, President Barack Obama blasted companies with federal contracts who don't pay taxes, saying it is "wrong for companies to take taxpayer dollars and not pay taxes themselves."
Although the bill was introduced Wednesday, Chaffetz said there's a long journey ahead. In committee meetings, when Democrats present a bill that would apply the same employment-tax rules to government contractors, Chaffetz said he plans to propose an amendment that would do the same thing as his bill.17 comments on this story
But regardless of whether it's an amendment or a separate bill, Chaffetz said it needs to pass.
"We know Congress is a slow process," he said, "but this is a fight worth fighting."
This story was reported from Salt Lake City.