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New York's Unique Approach To Tax Enforcement Working

by Mike Godfrey, Tax-News.com, Washington

20 March 2014


The Governor of New York, Andrew Cuomo, has announced that 8,900 New Yorkers have had their driver licenses suspended for failing to pay their taxes. The announcement follows the enactment last year of legislation to encourage tax compliance from individuals who owe more than USD10,000 in back taxes.

"We are sending a clear message to tax delinquents that they either have to pay the taxes they owe, or face real consequences," said Governor Cuomo. "For many, this message is getting through and as a result thousands of people have come forward to do the right thing and find a way to pay their taxes. Those who haven't are losing their driver's license."

"Driver licenses are a privilege, not a right, and this program has prompted unprecedented action from tax delinquents who were otherwise ignoring their debt," said the Commissioner of the New York State Department of Taxation and Finance, Thomas Mattox. "Thousands have contacted us to do the right thing – pay their tax bills in full, or work with us to arrange a payment plan that satisfies the debt."

More than 17,700 drivers were contacted in the first round of notifications beginning in August 2013. Along with the 8,900 suspensions, 6,500 tax debtors have either paid in full or are making payments on their debt, while 2,300 were determined to be ineligible for suspension.

As a result of the program, tax collections have increased nearly USD56.4m on a state and local basis – 34 percent above estimates. It is expected that "the program will continue to raise millions of dollars annually as thousands of other debtors are notified and, ultimately, resolve their debt."

When a driver gets a license suspension notice from the State's Tax Department, they have 60 days from the mailing date to arrange payment. If the taxpayer fails to do so, the Department of Motor Vehicles (DMV) sends a second letter providing an additional 15 days to respond. If the delinquent taxpayer again fails to make contact, the DMV is authorized to suspend the license until the debt is paid or a payment plan is arranged.

TAGS: individuals | compliance | tax | tax compliance | law | enforcement | tax authority | legislation | United States | Tax

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