Wisconsin can profit by getting tougher on tax evaders
| By JNorman @ IWF - Jan 12th, 2009 at 12:33 pm EST |
| Also listed in: Corporate Watch |
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Categories: State Budget Priorities, Corporate Accountability , Economic Fairness, Ethical Government, Public Infrastructure, Tax Fairness, One Wisconsin Now - The "tOWN Hall"
Categories: State Budget Priorities, Corporate Accountability , Economic Fairness, Ethical Government, Public Infrastructure, Tax Fairness, One Wisconsin Now - The "tOWN Hall"
It's hard to catch criminals without cops. And it's hard to catch tax evaders without tax auditors.
With Wisconsin facing its most difficult budget challenge in decades, the Institute for Wisconsin's Future (IWF) has a new report showing that increased investment in the state's Department of Revenue (DOR) could generate a substantial increase in tax collections without raising tax rates.
The report, titled "Investing in Revenue: How Wisconsin can profit by using the Minnesota model for closing the tax gap," shows how Minnesota used investments in its tax-enforcement capabilities to raise nearly one billion dollars since 2002, without raising tax rates.
Every dollar invested in building the tax-collecting capacity of Wisconsin DOR could return eight dollars in additional revenue for the state.
Increasing staff in the department's audit and collection operations would be the core of a more aggressive approach to collecting taxes that should be paid but are not. This money would help reduce the need to cut state services or increase state tax rates in order to produce a balanced budget for the 2009-2011 biennium.
Bolstering DOR enforcement capabilities would not only generate additional revenue, but also would make the tax system fairer for those who already pay their taxes on time.
However, Wisconsin's tax-collecting capacity has been eroding. 2008, for example, one out of every four jobs authorized in the 2001 DOR budget had either been eliminated or left vacant. By contrast, during the same period Minnesota was investing in the capacity of its revenue department. Minnesota's investment paid off, in the form of $900 million in additional revenue through enforcement activities, not tax increases.
See the full report at: www.wisconsinsfuture.org/publications/taxes/Press Releases/DORreport_1.09.09PR.pdf.
With Wisconsin facing its most difficult budget challenge in decades, the Institute for Wisconsin's Future (IWF) has a new report showing that increased investment in the state's Department of Revenue (DOR) could generate a substantial increase in tax collections without raising tax rates.
The report, titled "Investing in Revenue: How Wisconsin can profit by using the Minnesota model for closing the tax gap," shows how Minnesota used investments in its tax-enforcement capabilities to raise nearly one billion dollars since 2002, without raising tax rates.
Every dollar invested in building the tax-collecting capacity of Wisconsin DOR could return eight dollars in additional revenue for the state.
Increasing staff in the department's audit and collection operations would be the core of a more aggressive approach to collecting taxes that should be paid but are not. This money would help reduce the need to cut state services or increase state tax rates in order to produce a balanced budget for the 2009-2011 biennium.
Bolstering DOR enforcement capabilities would not only generate additional revenue, but also would make the tax system fairer for those who already pay their taxes on time.
However, Wisconsin's tax-collecting capacity has been eroding. 2008, for example, one out of every four jobs authorized in the 2001 DOR budget had either been eliminated or left vacant. By contrast, during the same period Minnesota was investing in the capacity of its revenue department. Minnesota's investment paid off, in the form of $900 million in additional revenue through enforcement activities, not tax increases.
See the full report at: www.wisconsinsfuture.org/publications/taxes/Press Releases/DORreport_1.09.09PR.pdf.
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