Gore report seeks more IT reliance

Vice President Al Gore's task force report on improving customer service at the Internal Revenue Service was met last week with criticism and praise by Congress and individuals familiar with the agency's modernization program.

The 92-page report, "Reinventing Service at the IRS," calls for the IRS to rely heavily on information technology to move the agency from a paper-based tax collection system to one that is dependent on electronic filing of tax returns and on the Internet, which will improve customer service.

The report recommends that the IRS invest in a wide range of IT solutions, including developing a system to electronically update taxpayers' addresses in its databases and building a tracking system to ensure that taxpayers' complaints are addressed. The report also recommends that the agency continue to develop its research database and models to analyze the public's compliance with tax laws.

In addition, the report calls for the IRS to reduce the paperwork for small businesses by relying more on e-mail to resolve tax account problems— but only after the IRS develops a way to protect the privacy of taxpayer information over the Internet. The IRS also is seeking credit card industry partners to test credit cards for taxpayers who may file electronically in 1999. "These new options will build upon the successful experience with about 15 million taxpayers whose refunds are deposited electronically," the report notes.

"I salute the vice president for his efforts," said Sen. Robert Kerrey (D-Neb.), author of IRS reform legislation and co-chairman of the bipartisan National Commission on Restructuring the IRS. "More and better customer service is a great idea."

However, Rep. Rob Portman (R-Ohio), the other co-chairman of the National Commission on Restructuring the IRS, said he believes the recommendations are a repetition of the commission's June 1997 report. "I didn't hear anything new," he said. "My concern is that the proposals that the vice president announced today are being trumpeted as solutions to the problems of the IRS. They are not. We need legislative changes to ensure that IRS reforms are successfully implemented and sustained over time."

IRS Commissioner Charles Rossotti said the IRS has begun to act on the recommendations, "such as customer segmentation. We are reorganizing and restructuring the IRS around the needs of our customers, just as the report urged."

Lockheed Martin Corp., heading one of the two teams vying for the Prime Systems Integration Service Contract, which will upgrade the IRS' computers, said Prime "provides for rapid response [to customers] while ensuring that technology development is planned to support the needs of the IRS over the long haul," said Thad Madden, a spokesman for Lockheed Martin Mission Systems.

Donald Brown, vice president of Computer Sciences Corp., which heads up another team bidding for Prime, noted that the report is further evidence that the IRS is moving in the right direction. "It is encouraging to see an agency such as the IRS realize it has the opportunity to take advantage of the lessons learned in the private sector and adopt those best commercial practices to achieve value for their operation," he said.

Michael Ettlinger, director of tax policy for Citizens for Tax Justice, said the report is not "hugely dramatic," but it confirms that the agency is taking the right approach. "We're all for making the IRS do a better job, and to the extent that technology can help stop the IRS from making mistakes, provide greater information through the Internet and decrease tax errors, obviously the taxpayers will benefit," he said.