BOISE – Idaho expects to lose up to $7.5 million in tax revenue next year because it cut tax compliance workers this year to save $979,000.
This year’s 4 percent state budget holdbacks prompted the state Tax Commission to place a hiring freeze on full-time positions, impose a mandatory two-day furlough on all but its lowest-paid workers, reduce wages for tax-season temporary employees, and eliminate 58 year-round temporary positions, workers who were let go on Dec. 26. Of those, 47 worked in audits and collections.
Royce Chigbrow, chairman of the state Tax Commission, told state lawmakers Monday that the agency is “taking steps to reduce loss” from the move. “It was preferable to eliminating full-time positions,” he said.
Chigbrow said he was pleased to report that, “Thirty-six of the 58 have come back and worked temporarily during the tax drive. … We get the advantage of their skills and experience for a few more months.”
But overall, he said, “Not all impacts can be mitigated.”
Jon Hanian, press secretary for Gov. Butch Otter, said the governor agrees with the direction Chigbrow has taken and is hopeful that efficiencies and other moves at the Tax Commission can “recover a good part” of the loss in tax revenue.
The Tax Commission’s plans include leaving 12 full-time support positions empty, Chigbrow said.
The agency also will shift additional duties to full-time employees, re-evaluate all support positions, use greater automation, modify procedures where appropriate, and reassign and reprioritize some audit work to full-time auditors.
The cuts are affecting services in the form of slower responses to taxpayer inquiries, Chigbrow reported to lawmakers as the Joint Finance-Appropriations Committee held a hearing on the commission’s budget.
Senate Finance Chairman Dean Cameron, R-Rupert, said he thinks it’s “ironic” that for years, the Tax Commission has come to lawmakers to request additional audit help to increase state tax collections. “And yet that seems to be the first place reductions are made,” he said. “We need to have that conversation, and we will.”
Chigbrow, who worked as a private CPA for more than 40 years before being appointed to the commission in 2007, said if he looked at the issue from a purely business perspective, the cutbacks would “probably not” make sense financially.
The laid-off year-round temporary workers all worked part time and got no benefits, he said.
“We don’t get rid of employees without it having an impact on collections,” Chigbrow said. “We are doing our very best to mitigate that.”
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