In turnabout, administration backs bill to overhaul IRS Changes lead White House to end strong opposition

October 22, 1997|By LOS ANGELES TIMES

WASHINGTON -- In an abrupt reversal that clears the way for the first major overhaul of the Internal Revenue Service in decades, the Clinton administration dropped yesterday its opposition to legislation to restructure the agency.

The White House turnabout came after congressional support for reforming the IRS -- roundly criticized of late for abuse of taxpayers and mismanagement -- suddenly snowballed into a powerful bipartisan force.

The legislation to revamp the agency was formally unveiled early in the day by Republican Rep. Bill Archer of Texas, chairman of the Ways and Means Committee.

A provision that had been at the core of the dispute over the bill would establish an independent oversight board -- dominated by private sector representatives -- to monitor the agency's budget and operations.

Key Democrats, including House Minority Leader Richard A. Gephardt of Missouri, immediately lined up to pledge support for the bill, which also would bolster taxpayer rights in dealing with the IRS and shift the burden of proof from the taxpayer to the IRS in cases that go to civil tax court.

After weeks of vehemently opposing the creation of the oversight board, Treasury Secretary Robert E. Rubin said late yesterday that the administration would support the bill because of changes made to it to accommodate White House concerns. In particular, Rubin welcomed elimination of a proposal to transfer the power to hire and fire the IRS commissioner from the president to the oversight board.

The administration's shift was viewed by many as a measure of how sharply the momentum for IRS reform has built in recent weeks. That threatened to leave the White House on the wrong side of a popular issue -- and opposite from Gephardt, who is seen as Vice President Al Gore's principal rival for the Democratic presidential nomination in 2000.

The politics surrounding the issue began to shift this fall when a series of hearings by the Senate Finance Committee broadcast emotional personal accounts of taxpayer harassment and mistreatment by the IRS.

Archer's bill, drafted in the wake of the hearings, is expected to be approved by the Ways and Means Committee today and to move along a legislative path well greased by public anger toward the IRS.

GOP leaders want the House to act on the bill before Congress adjourns for the year, probably Nov. 8.

Pub Date: 10/22/97

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