Lew: There's a 'deficit of confidence' in the IRS that must be rebuilt

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"It has to become a better customer service experience, it has to work well, and we know there's a deficit of confidence now that has to be rebuilt and that will be the job for the new commissioner of the IRS," Lew said during an appearance at the Aspen Ideas Festival over the weekend.

Lew's comments come as the agency seeks to do damage control after admitting that IRS personnel in the agency's Cincinnati field office had been applying a higher level of scrutiny to groups applying for 501(c)(4) status that had words like "Tea Party" and "patriots" in their names.

As a result of the scandal, the agency's acting commissioner, Steven Miller, stepped down and was succeeded by Danny Werfel, previously Office of Management and Budget (OMB) Controller.

More recently, a report by the IRS's inspector general for tax administration found that the IRS had applied a lower level of scrutiny to liberal groups seeking tax exempt status than it did to conservative groups. According to J. Russell George's report, only 30 percent of groups with words like "progress" and "progressive" were flagged for additional attention, while 100 percent of groups with titles like "Tea Party" and "patriots" were flagged.

George's report followed the release of documents that indicated other groups besides conservative organizations also received extra scrutiny from the IRS.