Hand a group of skilled artisans a set of powerful, innovative new tools, and you'll see some positive results immediately. In a matter of months and years, however, you'll see a positive return on investment that often surpasses the immediate results, as the artisans coax better results out of the new tools.
In a nutshell, that describes the past year at the General Tax Administration Program in DOR. In 2003, the Department began to administer the state's largest single revenue source, the sales tax, in its new SUNTAX integrated tax administration system, one of the first tax administration systems worldwide to be operated in the enterprise resource package technology. The early results are in, and they're remarkable.
$61.1 million in costs, $280.3 million in benefits
e-Filing Takes Off
The Internet is becoming a tool for taxpayers to do business with DOR. In just a few years, e-filing through the Internet has shot up from a few hundred tax returns in FY 1999-2000 to over a million tax returns in FY 2003-2004.
SUNTAX has proven to be an outstanding investment for the state's citizens. To date, SUNTAX and related technologies have been responsible for creating $280.3 million in savings and increased tax collections at all levels of state and local government. Costs total $61.1 million through June 2004. That's $4.59 in benefits for every $1 of the taxpayers' investment over the six-year life of the SUNTAX initiative.
In any field, an average 76-percent annual return is impressive. We expect our positive results to continue as DOR managers and employees work to fine-tune these new tools.
Less paper, fewer transferred calls
One step forward this fiscal year was the launch of the new SUNTAX Automated Case Management System. This system is allowing audit supervisors and auditors to manage audits for sales tax, corporate income tax, communications services tax and gross receipts tax in the SUNTAX system. Not only has use of this system allowed supervisors and auditors to work smarter and faster, it also has enabled DOR experts involved in disputed tax cases to get more complete access to audit information.
Where the Money Comes From
As this chart shows, Florida's sales tax is the single largest tax out of 36 taxes and fees administered by DOR. Sales taxes help pay for such vital public programs as education, law enforcement, and prisons.
In 2005, DOR will launch an "expert system" to help auditors identify cases of potential tax fraud faster and to apply the state's laws imposing penalty for late filing and payment of tax more consistently and fairly. Within two years, these expert systems will be expanded to allow other DOR employees to use them.
Another innovation this year was the establishment of a SUNTAX Customer Interaction Center (CIC) in GTA's Taxpayer Services Process. Using the new CIC software, DOR agents are able to instantly view a wealth of details about a taxpayer's account when a taxpayer calls. Agents can answer questions, waive penalty when appropriate, and sort out complicated accounts while the taxpayer is on the phone. It's another step toward one-stop, one-touch service for taxpayers.
Elsewhere, DOR is seeing massive growth in taxpayers' use of the Internet to file tax data. For example, taxpayers used the Internet to file 27.8 million unemployment compensation insurance-related wage items in State Fiscal Year 2003-04 – a 1,535-percent increase from the previous year. Much more than just a gee-whiz number, growth of Internet filings means that data is of higher quality, workloads are smaller, and DOR performance is improved.
Better insights into tax compliance
In August 2004, the Department began to use SUNTAX's Business Intelligence function to extract performance measurement information on a range of tax-related information. These performance measures will be used by DOR managers throughout the Department to improve performance.
In addition, by matching data from several sources and conducting advanced analysis, the Business Intelligence system is identifying areas where patterns of tax compliance can be improved. How powerful can data-matching be? One effort has produced more than $30 million in collections of sales tax on commercial rental property that previously went uncollected.
Our ideal result: Fairness
e-Registration Offers Advantages
The Internet is becoming a tool for taxpayers to do business with DOR. In just a few years, e-filing through the Internet has shot up from a few hundred tax returns in FY 1999-2000 to over a million tax returns in FY 2003-2004.
While DOR can calculate the value of savings and increased productivity down to the last dollar, the ultimate return on the SUNTAX investment is about more than dollars and cents. It's about fairness.
As DOR expands and strengthens the SUNTAX system and is able to make its actions more consistent and accurate, the Department is better able to ensure that tax administration is fair and uniform.
Fairness is more than a fuzzy ideal. It's what DOR's management experts call a critical success factor for our state's business climate. Business is best able to grow when tax rates are low, tax laws are stable, and tax compliance is voluntary and as universal as possible. In fact, voluntary compliance with tax law is the foundation of the entire American tax system. This system works only as long as taxpayers – particularly businesses – can be assured that others in similar situations are paying the same amount in tax.
Uneven administration of tax law hands a competitive advantage to those who are cleverest at cheating on taxes, not those who are the most productive or those with the best products and services. Simply put, tax fairness is essential to the health and competitiveness of Florida's economy.
