Ensuring Taxes Are Paid in W.Va.
There were several times this spring that Gov. Earl Ray Tomblin and West Virginia legislators would have been delighted had someone pointed them toward $30 million in previously unknown revenue. That much could have staved off cutbacks in some state programs, made to keep the state budget in balance.
It is just one-tenth of the amount of unpaid taxes legislative auditors say the state Tax Department should be able to collect. The total was reported to lawmakers as $298.3 million.
State Tax Commissioner Mark Matkovich takes issue with that. “Frankly, we are a little disappointed by the way some aspects of this audit report are portrayed,” he told legislators on Tuesday.
Matkovich explained that legislative auditors calculating the amount of unpaid taxes that could be collected included some money that probably is beyond reach. Back taxes from dead taxpayers and businesses no longer in operation were cited.
It may be that auditors overstated the amount. But if even a fraction of it can be collected, Matkovich’s department should be pursuing it. Again, even $30 million would be a windfall for the state.
State and federal tax collection agencies often have large lists of delinquencies. As Matkovich noted, some of the money simply cannot be collected.
But a report by the Legislative Post Audit Division states the Tax Department does not have effective policies and procedures to deal with the challenge. Officials in Matkovich’s agency said they will make improvements.
No doubt legislators will follow up on revenue from uncollected taxes. If a substantial chunk of that $298.3 million can be collected by next January, it will make their jobs much easier when budget time comes in spring 2015.
But they also should tell Matkovich they want progress reports on improvements in collecting taxes – and they should have legislative auditors check to ensure real progress is being made.