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By MARY DALRYMPLE, AP
WASHINGTON (Jan. 27) - Pimps and sex traffickers could soon find themselves being chased by tax collectors in addition to the vice squad.
Sen. Charles Grassley, chairman of the tax-writing Senate Finance Committee, wants the tax-collecting Internal Revenue Service to chase pimps and sex traffickers with the same fervor it stalked gangster Al Capone for tax evasion in the late 1920s.
Grassley would hit pimps with fines and lengthy prison sentences for failing to file employment forms and to withhold taxes for the women and girls under their command.
The proposal would make certain tax crimes a felony when the evaded tax was on money that comes from a criminal activity. A one-year prison sentence and $25,000 fine would become a 10-year sentence and $50,000 fine for each employment form that a pimp or sex trafficker had failed to file.
Grassley planned to propose the penalties when his panel meets Wednesday.
"The thugs who run these trafficking rings are exploiting society's poorest girls and women for personal gain," Grassley said. "The IRS goes after drug traffickers. It can go after sex traffickers."
Michael Horowitz, a senior fellow at the Hudson Institute, said the change would have the potential to put pimps out of business without difficult trials that require women to testify to abuse and mistreatment.
"We need to simply treat the pimps and massage parlor operators the way we would treat anybody who takes the proceeds of a customer transaction from somebody and then gives a fraction of it back," he said.
Under tax law, that relationship makes the pimp an employer, requiring the filing of a wage statement and the withholding of payroll taxes, including Social Security.
Grassley envisions creation of an office inside the Internal Revenue Service to prosecute sex traffickers for violating tax laws. The office would get $2 million (1.6 million) to get started, and it would be allowed to keep a portion of the taxes it collected.
The IRS work is intended to build on efforts under way to curb worldwide trafficking. The Justice Department, collaborating with U.S. attorney offices nationwide, would identify pimps and sex traffickers and refer them to the IRS.
Grassley also wants to change the IRS whistle-blower program to allow the girls and women to participate.
When the IRS goes after a pimp or sex trafficker for tax offenses now, it conducts lengthy audits of the suspect's lifestyle to estimate incomes from illegal activities and determine taxes due.
Al Capone, a Chicago gangster, gunrunner and bootlegger, was convicted on tax charges in 1931 and served seven years of 11 1/2 years in prison sentences.
WASHINGTON (Jan. 27) - Pimps and sex traffickers could soon find themselves being chased by tax collectors in addition to the vice squad.
Sen. Charles Grassley, chairman of the tax-writing Senate Finance Committee, wants the tax-collecting Internal Revenue Service to chase pimps and sex traffickers with the same fervor it stalked gangster Al Capone for tax evasion in the late 1920s.
Grassley would hit pimps with fines and lengthy prison sentences for failing to file employment forms and to withhold taxes for the women and girls under their command.
The proposal would make certain tax crimes a felony when the evaded tax was on money that comes from a criminal activity. A one-year prison sentence and $25,000 fine would become a 10-year sentence and $50,000 fine for each employment form that a pimp or sex trafficker had failed to file.
Grassley planned to propose the penalties when his panel meets Wednesday.
"The thugs who run these trafficking rings are exploiting society's poorest girls and women for personal gain," Grassley said. "The IRS goes after drug traffickers. It can go after sex traffickers."
Michael Horowitz, a senior fellow at the Hudson Institute, said the change would have the potential to put pimps out of business without difficult trials that require women to testify to abuse and mistreatment.
"We need to simply treat the pimps and massage parlor operators the way we would treat anybody who takes the proceeds of a customer transaction from somebody and then gives a fraction of it back," he said.
Under tax law, that relationship makes the pimp an employer, requiring the filing of a wage statement and the withholding of payroll taxes, including Social Security.
Grassley envisions creation of an office inside the Internal Revenue Service to prosecute sex traffickers for violating tax laws. The office would get $2 million (1.6 million) to get started, and it would be allowed to keep a portion of the taxes it collected.
The IRS work is intended to build on efforts under way to curb worldwide trafficking. The Justice Department, collaborating with U.S. attorney offices nationwide, would identify pimps and sex traffickers and refer them to the IRS.
Grassley also wants to change the IRS whistle-blower program to allow the girls and women to participate.
When the IRS goes after a pimp or sex trafficker for tax offenses now, it conducts lengthy audits of the suspect's lifestyle to estimate incomes from illegal activities and determine taxes due.
Al Capone, a Chicago gangster, gunrunner and bootlegger, was convicted on tax charges in 1931 and served seven years of 11 1/2 years in prison sentences.