Could You Please Pick Up That Pencil?

By Tom Yamachika, President, Tax Foundation Hawaii

At about this time last year, we focused on the Department of Taxation and its customer service, or lack thereof. So let’s see how the Department did in the year ending June 30, 2015, as reflected in the Department’s annual report.

Our first observation then was the Department’s call answer rate. If a practitioner or a taxpayer picks up the phone and calls the Department with a question, will a Department employee pick up the phone at all? Last year the probability that the Department would answer the call was 42%, less than half. This year it’s 43%, not much of an improvement.

Source: Department of Taxation, 2014-2015 Annual Report

If the Department is unable to pick up the phone, at a minimum there should be published guidance available so taxpayers can find their answers, either by themselves or with the help of tax professionals. Robust guidance helps assure that the answers given to people are consistent. In addition, tax practitioners need to advise their clients what that guidance says. We counted different kinds of administrative guidance and see the total dropping consistently over the last several years.

Source: Department of Taxation web site

The number of taxpayers who were assisted by the Department in person has been dropping an average of 10% a year. The Department explains it away by saying more taxpayers are e-filing and so they don’t have to visit the Department. Hopefully the drop is not due to taxpayers getting nowhere and giving up.

Source: Department of Taxation, 2014-2015 Annual Report

In any case, we urge the Department to continue to provide robust customer service, including coming out with timely guidance, and we urge the legislative and executive branches of government to provide adequate resources for the Department to do so.