California Organizes Revenue Recovery Team
- Oct 11, 2013 | Gail Cole
According to the State Board of Equalization (BOE), an estimated $9,000,000,000 (that’s nine billion) worth of taxes go uncollected each year. Unreported and underreported corporate, personal, and sales and use taxes make up the bulk of that impressive figure. And that, says the BOE, is not okay.
Lawmakers agree. So does Governor Jerry Brown (D), who recently signed the Revenue Recovery and Collaborative Enforcement Team Act into law. It’s a pilot program, and its mission is to “enhance existing efforts to combat criminal tax evasion associated with underground economic activities by institutionalizing collaboration among state agencies.” The Revenue Recovery and Collaborative Enforcement Team will, if all goes as planned, “authorize and facilitate data and intelligence sharing among participating state agencies.” Their focus will be on “the criminal and civil prosecution of those who operate in the underground economy and flagrantly violate the tax laws.” Flagrant violation of any law is, well, a crime.
The Revenue Recovery and Collaborative Enforcement Team will consist of:
- Franchise Tax Board;
- Department of Justice;
- State Board of Equalization; and
- Employment Development Department.
The following agencies may be called upon in an advisory role:
- California Health and Human Services Agency;
- Department of Consumer Affairs;
- Department of Industrial Relations;
- Department of Insurance; and
- Department of Motor Vehicles.
The team must submit a report to the Legislature by December 1, 2017. It should include:
- The number of leads or complaints received by the team;
- The number of cases investigated or prosecuted through civil action or criminal prosecution as a result of the team’s collaboration; and
- Recommendations for modifying, eliminating, or continuing the operation of any or all of the provisions of this part.
The pilot program is set to remain in effect until January 1, 2019, unless repealed or extended.
The team may be aided in its fight against tax evasion by California’s recent criminalization of sales suppression devices, or tax zappers.
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