The U.S. House of Representatives recently passed, by voice vote, legislation that would prohibit companies with seriously delinquent federal tax debts from receiving new federal contracts.

Introduced on Dec. 19, 2007, by Rep. Brad Ellsworth (D-Ind.), The Contracting and Tax Accountability Act (H.R. 4881) would require the head of a federal agency issuing an invitation for bids or a request for proposal for a contract in an amount greater than the $100,000 simplified acquisition threshold to require offerors to certify that they do not have a seriously delinquent tax debt.

It also would require offerors to authorize the secretary of the treasury to disclose to the head of the agency "information limited to describing whether the person has a seriously delinquent tax debt."

The term "seriously delinquent tax debt" is defined as an "outstanding debt under the Internal Revenue Code of 1986 for which a notice of lien has been filed in public records pursuant" to IRC Section 6323.

The administrator of the Office of Federal Procurement Policy has argued that the bill is unnecessary because a soon-to-be-released Federal Acquisition Regulation proposal would authorize federal contract officers “to use tax delinquency as sufficient grounds for debarment or suspension in accordance with the established process in the FAR for protecting government interests.”

A Senate companion bill (S. 2519), introduced by Sen. Barack Obama (D-Ill.), has been referred to the Committee on Homeland Security and Governmental Affairs.