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Contracting and Tax Accountability Act of 2013

Floor Speech

Location: Washington, DC


Mr. CHAFFETZ. Mr. Speaker, I thank Chairman Issa for his unyielding support in pursuit of good government. And I thank him for his support of this piece of legislation moved forward.

I also thank Ranking Member Cummings, in working with him and his staff, and certainly with Representative Speier, who also shares his passion of making sure that contractors are held responsible for their actions.

Mr. Speaker, today, tens of millions of individuals and corporations all across America will file their Federal tax returns and pay back any money they owe the Federal Government.

However, unfortunately, Mr. Speaker, there will be some who fail to meet this obligation and simply refuse to pay the taxes they owe.

This legislation, H.R. 882, the Contracting and Tax Accountability Act, has a very simple purpose: to prohibit companies with serious delinquent Federal tax debts from doing business with the Federal Government and receiving new Federal contracts. Since Federal contractors draw compensation and funding from taxpayer dollars, we must ensure that they are complying with existing laws and paying their own taxes.

Mr. Speaker, just last month this legislation passed through the Oversight and Government Reform Committee by voice vote, and it is identical to legislation that also unanimously passed the committee last Congress.

Going back a little further, Mr. Speaker, in both the 110th and the 111th Congress, former Congressman Brad Ellsworth of Indiana introduced very similar versions of this bill. And in the 110th Congress, the legislation passed the House again by voice vote.

It begs the question what's happening over there in the United States Senate, but we will continue to pursue this to make sure this legislation passes.

Also back in the 110th Congress, then-Senator Barack Obama sponsored the Senate companion, Contractor and Tax Accountability Act, to Congressman Ellsworth's legislation but, unfortunately, the legislation did not progress in either Chamber then.

As President, Mr. Obama has continued to fight for the contractors to be held accountable. I concur with the President on this issue. This is bipartisan.

We're going to lead and spearhead this effort here in the House of Representatives and make sure that it becomes law, but the United States Senate is going to actually have to step up and do something at some point in life, Mr. Speaker.

This is a good piece of legislation. H.R. 882 establishes the process through which persons with serious delinquent Federal tax debts may be prohibited from receiving Federal contracts and grants. The legislation is designed to mandate that tax compliance be a prerequisite for receiving a Federal contract or a grant.

As the chairman knows, the Federal Acquisition Regulation, known as the FAR, was revised in 2008 to require contractors to certify they do not have delinquent tax debt to the Federal Government. Under the

FAR revision, if a contractor is delinquent, then the standard Government-wide suspension and debarment process occurs in order to hold the contractor accountable.

H.R. 882 would, in essence, codify that regulation and provide a means to verify the contractor's certification. The legislation also provides broad exceptions for debts being paid in a timely manner, and debts to which a due process hearing has been requested or is pending.

Like the Federal Employee Tax Accountability Act, to be considered next, this legislation is meant to affect those thumbing their nose at Uncle Sam and the United States of America.

The Government Accountability Office, the GAO, has reported that government contractors owe over $5 billion in unpaid Federal taxes. Many of the contractors have repeatedly failed to fulfill their tax obligations and have delinquencies that have extended over multiple tax periods.

GAO even identified instances in which companies that are delinquent in their taxes have won contracts by submitting lower offers than companies that comply with their tax obligations, giving them an undue advantage.

Those who consciously ignore the channels in place to fulfill their tax obligations must be held accountable, and they must play on the same even playing field. This legislation will do just that.

I urge my colleagues to join me in supporting this commonsense, bipartisan piece of legislation. I again thank Chairman Issa for his support, as well as Ranking Member Cummings.


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