Obama getting tough on tax cheats

♦ 01/21/2010 ♦ 1 Comment

Written by Janet

Obama has directed the Office of Management and Budget and other federal agencies to keep contractors who are delinquent on their taxes from getting new contracts with the government. He signed this directive at the White House which is supposed to crack down on tax cheats, while hard working Americans pay their taxes.

He also stated that it was common practice for Washington to give contracts to companies that don’t pay their taxes, no more. He said that order can be issued by Congress and also through presidential memorandums. He cited from a 2007 report from the Government Accountability Office, that says there are tens of thousands of deadbeat businesses that owe more than $5 billion, money he said could be invested in education, health care or clean energy initiatives.

He also directed the IRS to review the overall accuracy of firms’ claims about tax delinquency “to be sure that when a company says it’s paying taxes, that company is, in fact, paying taxes.” The national managing director at alliantgroup LP and former tax counsel for the Senate Finance Committee, Dean Zerbe says the effort to clamp down on delinquent companies must be coupled with improvements in IRS service and protection of taxpayers rights. As of now, he said many businesses are struggling with “confusing notices and no one at the IRS to answer the phones.”

Obama has also asked Congress to help enforce the law, by passing legislation that lets the IRS share information about tax delinquency with contracting officials. And he said the fiscal 2011 budget the White House releases on Feb. 1 will recycle a proposal from last year’s budget that would require taxpayers to be paid before contractors with unpaid taxes.

1 Comment

  1. MTR
    01/21/2010 – 9:27 pm

    He worries about contractors not paying their taxes (which I doubt aren’t that many) yet his own Treasury Secretary, Tim Geithner, had tax problems of his own and yet Obama still brought him on board. Of course we know of other nominees that had similar issues.

    The amount of collected taxes from these contractors will prove to be minimal. This is nothing but horse and pony show. It means nothing.

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