Standing Up for Taxpayers

The success of the American tax system rests on the citizen’s willingness to pay. The system will remain voluntary only so long as the people perceive it to be fair. That in turn may depend on the fine line between collection and harassment.

To make certain that the line is not crossed, lawmakers in Washington and Sacramento are sponsoring measures that would enact federal and state taxpayers’ bills of rights. The proposals make such good common sense that it is a wonder they have not been written into law before now.

The California taxpayers’ bill of rights has been proposed by Assemblyman Richard Katz (D-Sepulvada) and Ernest J. Dronenburg Jr., a San Diego Republican and member of the state Board of Equalization. Assemblyman Elihu M. Harris (D-Oakland) has joined as a co-sponsor. The two-bill package would apply similar provisions to the state Franchise Tax Board, the state’s income-tax agency, and the Board of Equalization, which collects property taxes and some business taxes and hears appeals from the Franchise Tax Board.

The measures would establish the position of taxpayers’-rights advocate. The two agencies would be prohibited from encouraging “bounty hunting” by promoting employees on the basis of how much revenue they bring in. Tax-agency employees could be sued in rare instances of “intentional and reckless disregard” for a taxpayer’s rights. Taxpayers could recover the costs of court actions when the state agency was at fault or in error, such as in the improper seizure of property. And the plan would provide for a more aggressive program of taxpayer education.

The proposal would cost some money to implement, but the increase would be absorbed within existing budgets. As Dronenburg says, “This is good business.” The cost easily would be offset by more efficient and effective tax collection and greater taxpayer compliance. There would be better communication between the state tax agencies and the taxpayer. Taxpayers would be assured of getting a square deal when facing state audits and enforcement actions.

Both of the Katz and Harris bills have passed the Assembly without dissent and now are pending in the California Senate. They merit prompt passage and the governor’s signature.