Tax Amnesty Proposal

By: Public Information Office Staff
A proposal by the governor for a two-month tax amnesty period during Fiscal Year 2009-2010 could mean up to $150 million in back tax collections for the state if previous tax amnesty programs are any indication. The last program—conducted in 2001—collected more than $192 million in back taxes. About $300 million in tax collections and interest since then remain outstanding.

The proposed amnesty program would cover all tax periods since the last amnesty–July 1, 2001, through December 30, 2008. During the proposed two-month amnesty period, the state would waive all penalties owed on unpaid taxes and half of the accrued interest for any taxpayer who pays 100% of the owed tax and the remaining 50% of the owed interest.

Eligible taxpayers for this amnesty period would include those with an existing tax liability, those who did not file a required return or report, and those who understated or omitted any tax liability on a filed return.

The tax amnesty would not apply to motor fuel inspection fees, inspection and supervision fees collected on behalf of the Public Service Commission, motor fuels taxes, or penalties not associated with a tax. The program would exclude taxpayers under criminal investigation by the Department of Revenue and taxpayers against whom a civil fraud penalty has already been asserted.

The proposed tax amnesty program would generate one-time revenue and would not affect the 2009-2010 operating budget.

Legislation to enact the program will be proposed during the 2009 Regular Legislative Session.