This week at the CIO Academy in Sacramento, Acting Technology Secretary Christy Quinlan highlighted some innovative projects in her opening remarks. One was the Franchise Tax Board’s Enterprise Data to Revenue (EDR) project which is aimed at reducing the tax gap, the difference between what taxpayers should pay and the amount collected by the government. The solution, which will be phased in with final implementation by December 2016, will increase revenue coming into the General Fund by an estimated $1 billion annually.
The EDR Project does not include a full system replacement of FTB’s legacy accounting systems. Rather, the project includes enhancements to FTB’s legacy systems and creates a new tax return processing system that captures and utilizes more data. This enables FTB to increase return accuracy and taxpayer compliance while reducing the amount of resources needed to troubleshoot problematic returns. Ultimately, the new system will reduce waste and minimize redundancy while lowering the cost of maintenance and operations.
The EDR Project also includes an online Taxpayer Folder that enables taxpayers and other stakeholders to access their tax data at their convenience. Users will be able to view and print their tax returns, notices, and payment records, in addition to filing returns and making payments. With the Taxpayer Folder, FTB aims to improve customer service and take transparency to the next level for stakeholders.
Annually, FTB processes more than 15 million Personal Income Tax returns and one million Business Entity returns. The tax agency also responds to more than three million phone calls, handles over seven million Internet contacts and collects about $60 billion, which represents more than 65 percent of the state’s general fund revenue.
Another notable benefit of project is that it relies on a performance-based procurement which limits risk and capital outlay by the State, instead shifting it to the contractor.