Will the IRS Take Your Passport? … A little-noticed provision in the highway funding bill Congress passed this week threatens a right most Americans take for granted: the right to travel abroad. The provision in question gives the Internal Revenue Service the authority to revoke the passport of anyone the IRS claims owes more than $50,000 in back taxes. Congress is giving the IRS this new power because a decline in gas tax receipts has bankrupted the federal highway trust fund. – Ron Paul Institute for Peace and Prosperity
Dominant Social Theme: The IRS is a judicious and fairly run organization that administers tax laws clinically and allows for fair redress.
Free-Market Analysis: Ron Paul is out with his weekly column, entitled "Will the IRS Take Your Passport?" It deals with a bill that was just passed by Congress called the DRIVE Act.
Over at GovTrack we find this: "H.R. 22: Developing a Reliable and Innovative Vision for the Economy Act or DRIVE Act; Introduced Jan 6, 2015 … This bill was passed by Congress on December 3, 2015 and goes to the President next."
Ron Paul's editorial mentions the status of the DRIVE Act as well. It has been passed along with the provision that gives the IRS the power to suspend passports of delinquent taxpayers. The odds that President Barack Obama will decline to sign such a bill are almost nil. Dr. Paul points out that giving the IRS the power to revoke US citizen passports might be better positioned were the IRS an unbiased collection agency. But it is not.
In fact, we followed a good deal of the testimony that was presented to Congress over the past year and more regarding the IRS's efforts to slow down or halt non-profit status for so-called Tea Party organizations.
The upshot of that investigation can be found in a report in the Washington Examiner entitled, "Gowdy on IRS probe: How much more evidence could you need?"
Rep. Trey Gowdy blasted the Justice Department for stating … that there was "no evidence" of criminal intent in the Internal Revenue Service's targeting of conservative groups. "Never do you have direct evidence of intent," Gowdy, a former prosecutor, said during a House Judiciary Committee hearing Tuesday. …
The South Carolina Republican cited numerous examples of "circumstantial evidence," all of which resulted in discrimination against Tea Party nonprofits, regardless of the tax agency's intent. Gowdy noted Lois Lerner, former head of the IRS tax-exempt unit, had sent several emails that indicated she harbored a bias against conservatives.
What Gowdy repeats here, as he has done so many times before, is that IRS employees acted on apparent biases against conservative "Tea Party" organizations and discriminated against them. Ron Paul mentions this in his editorial as well, stating, "It is particularly odd that a Republican Congress would give this type of power to the IRS considering the continuing outrage over IRS targeting of 'Tea Party' organizations."
Ron Paul points out another concern that people have regarding the legislation: The provision doesn't "provide taxpayers an opportunity to challenge a finding that they owe back taxes in federal court before their passport is revoked."
And he adds, "IRS employees are not infallible … it is inevitable that many Americans will lose their right to travel because of a bureaucrat's mistake."
Of course, one might think that a civil suit could be launched against the IRS in cases of obvious abuse – where IRS administrators are evidently in the wrong. But then there is this post at The Daily Caller:
You Can't Sue Us Unless We Say You Can … Department of Justice lawyers claimed Wednesday the IRS cannot be sued for damages by the estimated 330,000 taxpayers victimized by hackers who earlier this year breached the federal tax agency's computer files.
Plaintiffs Becky Welborn and Wendy Windrich's claim of damage under the Privacy Act and the Administrative Procedures Act cannot be pursued because the doctrine of Sovereign Immunity, which holds the federal government immune to damage claims unless it agrees to such litigation.
Apparently, even when the IRS is egregiously and obviously in the wrong, it has the power to deny civil lawsuits by citing sovereign immunity.
One bright note regarding the passport provision in the DRIVE Act is that there were reportedly certain procedural changes made in a conference agreement that reconciled the Senate and House bills. These give citizens the right to "seek an injunction against the revocation of their passport if they are wrongly certified as being a delinquent taxpayer."
The procedural changes were reported in a post over at IRSMedic.com entitled "The IRS and Your Passport." However, in a case of one step forward and two steps back, the article goes on to inform us that, "Included in this bill (H.R. 22) is a provision that will require the IRS to outsource the collection of certain tax debts to private collection agencies."
Any funds collected by these private collection agencies will not be paid into the coffers of the federal government (at least not immediately). Instead, they go into a special fund. Out of this fund, the private debt collection agencies are able to be paid up to 25% of what they collect, based on their contracts with the IRS … The IRS has been directed to implement this new procedure "without delay."
The post also notes, as it should, that "allowing private debt collection agencies to collect on federal tax debts has failed miserably time and time again (and was discontinued following a massive outcry of unfair collections practices and abuses of taxpayer's rights)."
Historically speaking, the use of third-party firms to wield the vast power of state collections authority is such a bad idea that free-market historians have actually suggested it was one of the main causes for the fall of Rome. Tax collections during Rome's final days became so arbitrary and invasive that citizens supposedly simply refused to provide for the defense of the state. They went on a kind of strike, in other words, and eventually the "barbarians" poured into the city and looted it.
Of course, from what we know of history, it often repeats, especially when people are too stubborn to learn from it. Ron Paul writes:
Can anyone doubt that some Americans will be targeted because an IRS bureaucrat does not approve of their political beliefs and activities? Some support giving the IRS new powers because they think that those who underpay their taxes somehow raise everyone else's taxes. This argument assumes that the federal government must collect the maximum amount of taxes because the people cannot do without big government.
Ron Paul also writes, "Freeing the people from taxation, including the regressive and hidden inflation tax, is just one of the many ways the people will benefit from restoring constitutionally limited government."
The trouble with this perfectly reasonable and calmly stated perspective is that it probably won't happen. Statist repression and corruption are rarely reversed because they quickly gather a constituency that resists any attempt at redress. This is why we continually suggest that people take their own "human action" to avoid expanding mechanisms of oppression to which the West is increasingly subject.