Tax law unfairly targets federal contractors  Buylines |
Policies, strategies and trends to watch  Steve Charles  The 3
percent contractor withholding law should be changed.  No one
likes to pay taxes, including, it seems, government contractors.
According to the Government Accountability Office, some 60,000
contractors owe more than $7 billion in delinquent taxes. Many
of these same business owners have accumulated significant
personal assets, such as multimillion-dollar houses, luxury
vehicles and jewelry, GAO said.  During the past three years,
GAO delivered reports and testimony detailing many instances
when government contractors failed to pay income and payroll
taxes. Congress responded by passing Section 511 of the Tax
Increase Prevention and Reconciliation Act of 2005 (TIPRA). The
law amended IRS code Section 3402 to require federal and state
governments and "every political subdivision thereof " to deduct
and withhold 3 percent of payments made to contractors and
vendors after Dec. 31,  Have you thou