It's just another part of a misinformation campaign coordinated by the state Department of Revenue with the intent to create the most powerful state tax bureaucracy in the nation, even worse than the IRS. It's time to dispense with these half-truths and intentional misrepresentations.
No one in the Legislature condones tax evasion. The assertion that they do is simply nonsensical. Simply put, the Legislature creates laws prescribing who should pay taxes and how much, and they instruct DOR to collect those taxes and track down those who don't pay. That's the whole point of having a Department of Revenue.
Representatives Erickson, McAlpin and Hamilton's claim that we opposed all improvements to the DOR's tax collection efforts is false. The 2005 Legislature gave DOR an extra $1.4 million for additional auditors. This year, DOR received another 34 percent budget increase, the largest increase since its inception. We supported these budget increases and they passed with bipartisan support.
The representatives also asserted that they had two different solutions for ensuring people who sell real estate in Montana would ultimately pay Montana taxes. One would have provided for withholding, the other would require the same form filed with the federal government to be filed with DOR.
However, DOR's estimate on the impact of the loss in capital gains tax from out-of-state sellers was incredibly inflated. The Montana Land Title Association completed an independent study of 8,664 sales across the state (DOR used a sample of only 692 from four western counties and Billings).
DOR claimed 70 percent of the sales in their sample would have been subject to capital gains. The independent study found that only 1.7 percent might have been subject to withholding, or two out of every 300 sales. How could anyone support such a radical change in Montana tax law for a problem invented by DOR that would cost all Montanans extra charges from closing companies?
We supported the concept of requiring filing of the 1099s, including a bill introduced by Republican Sen. Bob Story. The representatives' irresponsible claim that Republicans did not support the 1099 filings is completely baseless.
Contrary to the representatives' claim that DOR was not given enough staff to work with other states to collect from “tax cheats who ignore collection letters and phone calls from the Montana DOR,” a bill that did just that passed though both houses. This bill gives unlimited appropriation authority to DOR to work with other states to improve collection. We strongly supported this legislation as well.
In yet another false claim, the representatives note that DOR is unable to obtain information on people who engage in abusive tax shelters. That information is already available from the IRS. Moreover, the director of revenue signed an agreement to enter into a voluntary compliance initiative for abusive tax shelters with the Multistate Tax Commission on April 2 this year.
No one from DOR disclosed this program during the legislative session, and in fact they continued to testify they needed legislation to accomplish what they had already done. Once again, DOR was not being forthright about their real agenda for Montana taxpayers.
The legislation proposed by DOR added complex and confusing sections of law that apply to all Montana taxpayers. Many taxpayers who believed they complied with Montana law could have been subject to penalties and interest at the whim of DOR under new, broad rulemaking authority.
If you were wondering why this administration continues to use sound bites that have no factual basis, attacks honest taxpayers and believes the Montana Department of Revenue should become a super IRS, take time to read between the lines and vote for tax fairness next election.
Republican Rep. Bill Nooney represents House District 100 in Missoula and serves on the House Taxation Committee.
|
 |
 |
Add your comment now! Write your comment in the form below.
(Email address is for verification only. If you'd like to email a story, look for the link above)