DOR: Surveys, statistics show system is working

Under Gov. Jim Doyle's leadership, Wisconsin businesses have benefited by an improved and more competitive business climate. Doyle's clear vision to create a high-end economy for Wisconsin has resulted in countless successes for continued business development and job growth, including:

•  Adopting the most aggressive regulatory reform policy in the Midwest;

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•  Passing legislation to stimulate venture capital;

•  Implementing a manufacturing sales tax exemption on fuel and electricity;

•  Removing the tax penalty on businesses that create jobs;

•  Passing legislation to improve services to taxpayers.

The Department of Revenue's (DOR) mission - to administer the state's tax laws in a fair, equitable and efficient manner - plays an important role in ensuring that this momentum continues. That's why DOR continually looks for opportunities to improve our service to business taxpayers and assist them in voluntarily complying with Wisconsin's tax laws.

If conducted properly, survey data can offer useful feedback and information. While the methodology employed by WMC and the disappointing survey response rate (roughly 3.5 percent) make it difficult to draw a sound conclusion, DOR appreciates and respects the opinions offered by some WMC members.

Providing clear and consistent guidance to customers is a critical strategy for achieving voluntary tax compliance. The DOR employs numerous tactics to help make that happen, including conducting frequent staff training and updates, responding timely and consistently to tens of thousands of taxpayer inquiries, offering clear guidance and updates on state tax policy through the Wisconsin Tax Bulletin, and Sales Tax Reporter, and leveraging numerous communication channels such as focus groups with tax practitioners and meetings with the Wisconsin Institute of CPAs.

The audit function plays another critical role in tax administration. Our job is to help people understand their responsibilities and to be fair in our approach. We take this responsibility seriously and are constantly seeking feedback to ensure that we conduct all of our responsibilities professionally.

The department typically achieves a response rate of more than 60 percent on its post-audit surveys of taxpayers. Our results are impressive. Depending upon the type of audit conducted, 85 percent to 95 percent of responding customers indicate they were treated fairly.

Lastly, WMC concludes that drastic changes are needed in Wisconsin's tax appellate and court procedures. We disagree. A 2004 evaluation conducted by the Council on State Taxation (a national nonprofit trade organization consisting of the nation's largest corporations) found that Wisconsin's system is very balanced. Their study used several criteria to determine if a state has a fair and efficient tax appeal system, including: 1) the tax tribunal is independent; 2) the judges are specifically trained in tax law; and 3) taxpayers are not required to prepay a disputed tax or post a bond in order to receive an independent, impartial hearing. Based on these criteria, Wisconsin received a score of 12 on a scale from 1 to 15.

Despite what the WMC survey might suggest, we've been fortunate to develop a strong and positive relationship with Wisconsin's business community. Nevertheless, my door is always open and I welcome the opportunity to discuss ways to further strengthen the trust and confidence placed in us by Wisconsin's businesses.