Opinion

Federal employees who don’t pay their taxes should be fired

Photo of Rep. Jason Chaffetz
Rep. Jason Chaffetz
Member of Congress (R-UT)

If you’re collecting a federal paycheck, you should pay federal taxes. That’s the premise of a bill I introduced last week to require federal employees to pay their taxes or be fired.

The IRS reports that 100,000 federal civilian employees are seriously delinquent on their federal taxes. These aren’t just people who fell behind. These are people who have actively defied IRS letters and phone calls seeking payment. In 2009, the US government failed to collect $1 billion a year from federal employees alone.

While the number of delinquent federal employees has remained fairly constant since 2004, the amount owed has increased nearly 70%. The bill further prohibits the hiring of future employees who have failed to pay taxes. We’ve got to tackle this problem.

Only IRS employees can currently be terminated for not paying federal income taxes. Consequently, IRS has the highest tax compliance rate of any federal agency. Numbers from the IRS, Office of Personnel Management and Department of Defense show a very different story among other federal agencies. US Postal Service employees owed more than $257 million in 2008. Department of Veterans Affairs employees owe a combined $131 million. Between the Army and the Navy, more than 17,000 employees are delinquent. The tax problems even stretch as far as Capitol Hill, where there were 447 House employees and 231 Senate staffers who fell into the “seriously delinquent” category in 2008.

Working for and doing business with the United States of America is a privilege. Those unwilling to play by the rules should not be entitled to the privileges of federal employment or federal dollars.

Because I believe these policies should extend to anyone doing business with the federal government, I also introduced a second bill to prohibit any person who has a seriously delinquent tax debt from obtaining a federal government contract or grant. Competition for such funds is steep. No one who ducks a federal tax obligation should be eligible to benefit from federal funds.

It’s true that many taxpayers fall behind for one reason or another. If a federal employee is truly trying to dig out of a hole, he will not be fired. Nor would this legislation impact federal employees who enter installment agreements to pay off their tax debts. Moreover, designating a taxpayer as “seriously delinquent” is a multi-step procedure that affords the federal employee due process.

However, Congress must send the message that those who deliberately and willfully dodge federal tax obligations should not expect to collect a taxpayer-funded paycheck. At a time when this country is nearly $14 trillion in debt and many Americans are struggling to find work, the federal government need not tolerate tax evasion within the federal workforce.

Congressman Chaffetz serves on the Oversight committee overseeing Federal Workforce, Postal Service, and the District of Columbia.

  • dalgray

    Why are state or federal employees taxed at all? The process of taxing government employees is an accounting scam, why deduct money that we shouldn’t pay them anyway? The only reason is to give cover to the fact that they are supposedly taxed like the rest of us. Are they? Think about it. We notionally take tax off their wages but it is all hypothetical. They receive the money they expect for the job with a notional deduction of tax on top. You have to stop and think about this one for a few moments but you will soon get the idea.

    Let me explain, the government takes in money from the taxpayers to pay its employees and pays them, keeping back money that it says is tax. Then what? Where does that money go? Assuming it is put in the common funds for state and federal use, that amount to taxing the taxpayers twice, after all we are paying the salaries in the first place and then the tax on top of that! Wealth passes from us to the state employee but we pay their taxes they don’t. Stealth double taxation anyone? The more the civil servants are paid above the rest of us the less tenable is the idea they are paying any tax.

    Private individuals pay tax raised on their earnings; there is nothing hypothetical about it. However, those who are taxed on their wages suffer another fraud, subtle but it is there nevertheless. In your pay packet you receive a list of deductions some paid by your boss some by you. What does this mean? It all leaves your pay packet. What does it matter who supposedly pays for it? It is still GONE! It is all the cost of employing you to your boss.

    Your job is worth a set sum of cash, plus cash you don’t get that disappears from your hands before you get it, ignoring retirement contributions which are embargoed funds that you can’t touch for the sake of this argument. Who really pays an employee’s wages and taxes? From the employer’s point of view

    1. On the one hand, there is the money paid to you the employee, that is money in your pay packet,
    2. Then on the other hand there are all the extra costs in taxes and deductions that amount to the cost of employing you the worker.

    The total sum is what matters, that is all the wealth that leaves the business. Putting accounting labels on what leaves the wage packet and where it goes, doesn’t change what happens; it is the total amount that has to be paid that matters, the cost of keeping you working for the business. To repeat the point, the wealth leaves the business and is the gross cost of you, the employee, to the business you work for. In short, money leaves the business unlike in the government’s case where taxes stay within the government.

    Back to state employees, it is bogus to deduct taxes from them, unlike a private business, the funds don’t leave the business of government, this is the difference in the scheme of things. Every government employee cost us his salary and the taxes we pay on him or her. Now I think you understand, we pay his salary and the government gets his taxes. This is just an accounting exercise why not pay government employees a tax free bounty for what they do for us. This would save the cost of bookkeepers to move government money around to look as if they are paying taxes. We are paying the taxes! It is a moot point who is paying tax here for some, it is my contention they are not paying tax. The higher the wages the more tax is deducted into the hands of the government quite unlike a private business. It is all a question of perception. Once you see government employee taxes as not paid by them but as money retained by the government the question is why are we paying for this arrangement?

    Paying them a gross salary would create a frisson of avarice in the public mind, the notion of privilege would then be more apparent amongst those in government service. The old adage that the civil servant is civil and servile is absurd, these are unelected governors of our lives paid, more often than not, stipends of princely proportions.

    There is much to be said to pay government salaries (better than the old roman chunks of salt) net of all tax or rather as gross salaries. Their status as tax free employees would advance the notion of privilege which they have, high salaries and the perks we the taxpayers cough up for are the evidence of that privilege. Enhancing the profile of privilege would make it easier to limit the rapaciousness of the salariat classes of our unelected government servants. The hubris of Wisconsin would be far easier to reign in if we saw them as grossly privileged in the first place.

    As a self employed person on the margins of the economy I am a little miffed by these antics. I know which pocket the tax I pay comes from. Taxing the governing classes is smoke and mirrors that is all it is. The money still ends up in the hands of big spenders with no limit on their desire to spend and these are some of the people, unelected by us, who want more money for themselves to spend at home and at work too, supposedly spending it on our behalf.

    Government is largely insolvent, the problem is it can’t go bankrupt there is no procedure for it to do so. Rapacious wage claims are only a part of the problem. Taxing these people on their wage claims merely adds to the money that has to be collected from the rest of us to pay them. Abolishing income taxation for public servants would be the way to go here. Come to that; why not abolish it for the rest of us? That would be nice!

    There is thus a reasonable argument for not requiring them to pay tax at all. So why bother? It is just an accounting exercise. Or am I wrong here?

  • Dragging Tree

    They the Government should garnish their wages @ 100% (sorry I am not a bleeding heart)

  • http://www.facebook.com/people/Michael-Quinney/1619139154 Michael Quinney

    PEOPLE! The Sec. of the Treasury didn’t pay his taxes! Why are you surprised.
    Paying taxes are for the great unwashed masses of middle class, not the elite of this country. Isn’t that what the democrats keep saying? And Government employees are certainly the elite of this country./snarkism.

  • lonecracker

    How can they not pay taxes? Mine are deducted from my paycheck. These people can be identified easily and they should be arrested just as easily. Why haven’t they been put in jail? I would have been and any other non federal employee would have been jailed.
    A billion here and a billion there, as Senator Everett Dirksen said oh, so many years ago, pretty soon it adds up to a tidy sum. Paraphrasing, folks, he actually said a million here and a million there.

  • DrBill34

    Please people, don’t be so naive. After having served 6.5 years as a high level fed, I quit and am now in Australia. Many feds dodge taxes. Remember, they know all too well how money is squandered. They also know the odds of getting caught and actually punished are minimal. Firing a ‘tenured’ fed is almost impossible. People who don’t, or can’t, do their jobs are regularly promoted because there is no downside for the supervisor and all !@#$ breaks loose if the supervisor resists. Your employees will spend their entire day talking to their pals, union officials, and half-witted political appointees. If the tea party actually knew what was going on, they’d be the TNT party! BTW, even if they do get fired, for not paying taxes or stealing federal funds, they get to keep retirement and other benefits, and the entire matter is quietly swept under the rug, using ‘confidentiality’ as a cover.

  • DrBill34

    Please people, don’t be so naive. After having served 6.5 years as a high level fed, I quit and am not in Australia. Many feds dodge taxes. Remember, they know all too well how money is squandered. They also know the odds of getting caught and actually punished are minimal. Firing a ‘tenured’ fed is almost impossible. People who don’t, or can’t, do their jobs are regularly promoted because there is no downside for the supervisor and all !@#$ breaks loose if the supervisor resists. Your employees will spend their entire day talking to their pals, union officials, and half-witted political appointees. If the tea party actually knew what was going on, they’d be the TNT party! BTW, even if they do get fired, for not paying taxes or stealing federal funds, they get to keep retirement and other benefits, and the entire matter is quietly swept under the rug, using ‘confidentiality’ as a cover.

  • Pingback: Chaffetz wants to fire tax delinquent federal employees- but why stop there? - postalnews blog

  • Tess_Comments

    How can a person collecting a federal paycheck get away with NOT paying federal taxes?

    Anyone who gets a paycheck and does not pay the federal taxes they owe for 2 years or more should have their assets froze. Then they should be fired.

  • California7

    I can’t believe this law doesn’t already exist.