Former acting Internal Revenue Service (IRS) Commissioner Steve Miller (right) and Treasury Inspector General for Tax Administration, J. Russell George testify May 17 before a full House Ways and Means Committee hearing in Washington on 'Internal Revenue Service Targeting Conservative Groups.' President Obama sacked the acting head of the Internal Revenue Service on May 15 over a scandal sparked when officials unfairly targeted conservative groups. (Nicholas Kamm / AFP)
WASHINGTON — The nation’s top tax official apologized for the agency’s treatment of conservative groups, denied he lied to Congress about it, and insisted that politics did not motivate the agency’s decision to give Tea Party groups extra scrutiny.
“Partisanship or the perception of politics has no place in the IRS,” acting commissioner Steven Miller said in a brief opening statement to the Ways and Means Committee, which is investigating the affair.
“I do not believe partisanship motivated the actions” of the tax-exempt organizations office in Cincinnati, he said. Rather, “foolish mistakes were made by people trying to be more efficient in their workload selection.”
But from there, Miller was grilled about who was responsible for the targeting, what the agency has done to hold them accountable, and why he and other IRS officials did not disclose it when they first became aware of it.
Many of those questions were derailed by disagreements about the definitions of words such as “targeting” and “mislead.”
“When you talk about targeting, it’s a pejorative term,” he said. Rep. Peter Roskam, R-Ill., later noted that the term appeared 16 times in an inspector general audit of the matter released this week.
Miller said former IRS commissioner Douglas Shulman’s testimony failing to disclose the activity — in response to specific questions — was “incorrect,” but not misleading.
And Miller also admitted that the first public apology for the scandal — which came from Tax Exempt Director Lois Lerner at an American Bar Association conference a week ago — was in response to a question planted by the IRS. That was two days after Lerner testified to a congressional committee and again failed to acknowledge there was any targeting.
Miller said only two employees were disciplined: One, who sent inappropriate follow-up questions to Tea Party groups, was reassigned. Another was given “oral counseling” for compiling the list of keywords that were used to hold up applications of political groups.
“With all due respect, this systematic abuse cannot be fixed with just one resignation, or two,” said committee Chairman Dave Camp, R. Mich. “This is not a personnel problem. This is a problem of the IRS being too large, too intrusive, too abusive.”
“It looks like the truth was hidden to the American people just long enough to make it through an election,” Camp said.
The panel’s top Democrat, Rep. Sandy Levin, D-Mich., said he, too, wanted to find out why the IRS targeted conservative groups for extra scrutiny, and that IRS officials responsible should be fired. But he took exception to the injection of campaign politics into the hearing.
“If instead this hearing becomes an effort to score political points, it will be a disregard of the duties of this committee,” he said.
And many Democrats turned to what they saw as the bigger issue: A tax code that doesn’t make clear what kinds of political activities a tax-exempt social welfare organization can participate in. Rep. Lloyd Doggett, D-Texas, said the Democrats should defend the right of the Tea Party to “be as wrong as it wants to be” but should guard against anonymous “dark money” being funneled into political campaigns through tax-exempt groups.
The agency’s chief watchdog testified Friday that the Internal Revenue Service has not fully addressed the problems that led it to improperly subject Tea Party and other conservative groups to extra scrutiny.
“We do not consider the concerns in this report to be resolved,” Treasury Inspector General for Tax Administration J. Russell George said.
It was George’s report that uncovered the practices in the IRS’s tax exempt office, which began in 2010 and continued until media reports and congressional questions prompted his audit last year.
George said there was “no evidence” of political motivations on the part of IRS officials in Cincinnati, where all applications for tax-exempt status are processed. But it did blame “a lack of managerial review, at all levels.”
The report has already led to the resignation of two top IRS officials and launched a criminal investigation by the FBI.
The House’s tax-writing committee is one of three congressional committees promising hearings on the affair. The House Oversight and Government Reform Committee on Wednesday requested to interview five low- to mid-level IRS employees.
Among them: Holly Paz, the director of rulings and agreements in Washington, who made $155,500 in 2011. She contributed $2,000 to President Obama’s campaign committee in 2008, campaign reports show.