City Hall could be doing a more efficient job of collecting sales tax revenue in New Orleans, according to a new report by Inspector General Ed Quatrevaux that points to a lack of written policies and scanty record keeping.
The report will be released Wednesday.
“Sloppy files led to disorganized sales tax collection efforts by the city’s compliance division,” Quatrevaux said in a statement, summing up a review of tax collections during 2011 and 2012 against companies suspected of owing the city money. “The result was delayed revenue and cash flows for the city.”
In a written response, Deputy Mayor Andy Kopplin pointed out that Quatrevaux’s audit showed no violations of state law. And he said the city has acquired a new revenue system that should be in use by the end of 2014.
But he disagreed with most of the inspector general’s recommendations for cleaning up the tax collection process.
For instance, Quatrevaux recommends that the city’s Bureau of Revenue adopt specific written policies on the various steps the bureau will take to enforce tax collections against companies with unpaid obligations. Kopplin responded that the bureau does in fact follow written policies: “state and local law.”
Quatrevaux also knocks the city for failing to keep complete files on taxpayers that it decides to audit. Kopplin responded: “A complete audit file contains a large volume of information which may not be necessary in every sales tax audit and is not required by state law.”
Whether the city completes sales tax audits in a timely way also is in dispute. Quatrevaux’s report, for example, says 12 of 35 audits examined by his office took up more than 80 man hours. Kopplin countered that 80 percent of the bureau’s audits were completed in fewer than four weeks.
Finally, Quatrevaux criticized the city for not being aggressive enough in going directly after bank accounts in order to collect when taxpayers haven’t paid up. He said 23 percent of the 35 bank accounts examined were never tapped, as required by the bureau’s own policy.
Here, Kopplin cited extenuating circumstances, noting that in one case reviewed by the inspector general, the taxpayer had agreed to pay in installments, so going directly after his bank account would “have been counterproductive to our collection efforts.”