NY turns $10 million investment into $1 billion in savings

Automated analysis tools pay big dividends for state tax collectors

Since implementing an automated compliance and audit tool in 2003, the New York State Department of Taxation and Finance has saved an estimated $1 billion and expects to gather an additional $100 million in taxes during the next three years by using the collection analysis and workflow tool.

“That’s a pretty good return on an investment of less than $10 million,” said William Comiskey, the department's deputy commissioner of tax enforcement.

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The savings were generated through a partnership with IBM to develop the tools that Comiskey said are needed for his department to run efficiently. Tax administration requires considerable investment in technology, analytics and predictive software, he said.

“The department has been working closely with IBM in the development of the Tax Audit and Compliance System, which is extremely successful, and the Tax Collection Optimizer,” Comiskey said. “The more data we can acquire, the more likely we will be able to identify the taxpayers who are doing the right thing and those who aren’t.”

Identifying taxpayers who are doing the right thing means fewer unnecessary audits, which is a good thing for both the department and taxpayers. Identifying those who aren’t means better collections of taxes owed.

About the Author

William Jackson is a Maryland-based freelance writer.

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Reader Comments

Fri, May 28, 2010 Satisfied Taxpayer Brooklyn NYC

I got notice from NYS Taxation & Finance that there was error on my Personal Income Tax Return. Refund was $11 more than I claimed because of my computational error. These systems work for taxpayers too!

Thu, May 13, 2010

Agree with 1st comment. 2nd is dumb. If the laws are such that the taxes are owed and have been billed, they should be collected. If you don't like the amount, work on changing the legislation. To just accept that some people aren't going to pay and not take effective steps to collect it is penalizing the ones that are paying.

Thu, May 13, 2010 Tea Partier 2

Great to see a government entity being more efficient and effective. Now, when will they lower taxes since they are being so efficient?

Wed, May 12, 2010 Tea Partier

Typical government think: More tax taken from the private sector is a "savings".

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