PHOENIX — The state agency in charge of enforcing tax laws for thousands of Arizona corporations is now down to four auditors.
The Arizona Department of Revenue, which at one time had 30 corporate auditors, has been dramatically slashed by budget cuts.
Department spokesman Sean Laux said Wednesday that the agency has $7 million less in its budget than last year.
The department cut more than 50 workers last June. Most were auditors and collectors in the education and compliance division.
“(But) we haven’t seen any drop off in our ability to enforce the state’s tax laws, either on the audit side or the collection side,” Laux said.
Georganna Meyer, a former economist at the department, told lawmakers that “there is likely no corporate income tax auditing occurring” with only four auditors to monitor more than 50,000 companies.
“I’m going to be the one to own up to being the one that dropped their corporate revenue forecast significantly because of the absence of enforcement at the Department of Revenue,” she said. “There’s basically is no longer any corporate audit activity at the Department of Revenue, and it’s going to have significant impact on any enforcement revenues.”
Laux said corporate income tax auditing and collecting have not been impacted.
“We were certainly as surprised as you all in the room to hear Georganna’s comments,” Laux said. “We don’t buy it.”
Laux said the lower number of auditors will not impact the agency’s audit work. Not including revenues from last fiscal year’s amnesty program, corporate income tax collections in FY2016 were 230 percent higher than the agency’s objective, he said.
“We continue to outperform both our projections and our year-over-year numbers,” he said.
Grant Nulle, deputy director of the department, said the agency is now focused on front-end compliance to reduce the need for back-end auditing.
Information from: Arizona Capitol Times, http://www.arizonacapitoltimes.com