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lic and in small businesses. For example, and I think we've talked about this before, reporting requirements proposed by the Environmental Protection Agency under the Regulatory Right-to-Know Act provide it with information about onsite toxic materials that pose a danger to the surrounding community. If the EPA did not collect this type of data, it would need to conduct onsite inspections which are significantly more intrusive than reporting requirements. And much of the increase in paperwork proposed by the IRS reflects the fact that the Government is imposing less of a financial burden on American taxpayers by offering more tax breaks.
Nevertheless, I agree with Chairman McIntosh, we need to make sure that the information the Government is collecting is information it needs, and it's being collected in the least burdensome and most efficient manner. Paperwork can be very costly on our small businesses and individuals. And I know it's that concern which motivates Chairman McIntosh and I think that's a concern that always needs to be stated. That's why we're here, to try to make things a little bit better for the American people. So I appreciate the job that you're doing in that regard.
We have to make sure that the agencies are doing their best to eliminate unnecessary burdensome requests, to streamline forms and to consolidate requests. And I'm sure that this hearing will shed some light on the IRS and other agencies' fulfillment of these important responsibilities.
Again, Mr. Chairman, thank you for holding this hearing. I look forward to the testimony.
[The prepared statement of Hon. Dennis J. Kucinich follows:]
Statement of Rep. Dennis Kucinich
Ranking Minority Member
Mr. Chairman, thank you for holding this hearing on paperwork reduction.
I am especially pleased that Commissioner Rossotti could join us here today. About eighty percent of the paperwork burden imposed on Americans is imposed by the Internal Revenue Service. And with “tax day” just around the corner, it is a good time to reflect on whether the IRS is doing a good job at limiting the paperwork burden it places on the American taxpayer.
Mr. Chairman, I share your concern that we are not only failing to meet the Paperwork Reduction Act goal of reducing the paperwork burden by 30% over the last 4 years, but the paperwork burden has actually increased by about 3% over that time period.
It is my understanding that much of the increase is due to our actions here in Congress. For instance, Congress
passed the Taxpayer Relief Act of 1997 -- an initiative originally proposed as part of the Republican Contract with America -- which cuts capital gains, estate, and gift taxes. The IRS estimated that these changes increased the
paperwork burden by over 64 million hours.
Much of the remaining increase is apparently due to the increased economic activity in our booming national economy. Furthermore, the methodology for estimating the paperwork burden may not be giving enough credit for the time saved by the increase in the use of electronic and telephone filing. I look forward to hearing from the witnesses who can provide further insight into underlying causes of the increased burden.
However, Mr. Chairman, I do not want to belittle the importance of the information we collect. Without taxes, our government could not provide the protections, benefits, and services Americans depend on and often take for granted. It is imperative that the IRS successfully fulfill its mission to collect the right amount of tax. Similarly, the other agencies need the data they collect in order to fulfill their important
It is also important to keep in mind that paperwork can actually reduce the overall burden the government would otherwise need to place on the American public and small businesses. For instance, reporting requirements posed by the Environmental Protection Agency under the Regulatory Right to Know Act provide it with information about on-site toxic materials that pose a danger to the surrounding community. If the EPA did not collect this type of data, it would need to conduct on-site inspections which are significantly more intrusive than reporting requirements. And much of the increase in paperwork posed by the IRS reflects the fact that the government is posing less of a financial burden on American taxpayers by offering more tax
Nevertheless, we need to make sure that the government is collecting the information it needs in the least burdensome and most efficient manner. Paperwork can be very costly on our small businesses and individuals. We should make sure that agencies are doing their best to
eliminate unnecessarily burdensome requests, to streamline forms, and to consolidate requests. I hope this hearing will shed some light on whether the IRS and the other agencies are fulfilling these important responsibilities.
Thank you, again, for holding this hearing and I look forward to the testimony.