Tax Agency Organization & Culture Change
Happy New Year!
Throughout the fall of 2021, the Center for Taxpayer Rights held an online series of workshops called Reimagining Tax Administration: Social Programs Through the Tax Code. The series, funded by the Rockefeller Foundation, was something we have wanted to do for quite some time – that is, explore the use of tax laws and tax agencies to administer social benefits to vulnerable populations. We have been posting the agenda, slides, and videos from the series here, and today we are sharing the most recent video from the November 8th session, Organizational Stucture and Culture Change.
Of course, tax codes have been used since the beginning of time to drive and reward behavior; in the United States, since 1975 and the enactment of the Earned Income Credit, the Internal Revenue Code has been used to create incentives for work among working poor families. This approach expanded greatly with the enactment of the Affordable Care Act and the Premium Tax Credit, a subsidy paid monthly by the IRS which makes health insurance affordable for low and some middle income families.
The COVID-19 recovery legislation sealed the deal on the use of the IRS to deliver benefit payments to hundreds of millions of people – taxpayers and non-taxpayers alike. Indeed, the one-year expansion of the Child Tax Credit (CTC) and the monthly advance payment of the CTC in 2021 saw the tax agency distributing a nearly universal child benefit. The Congressional Research Service has estimated that 96% of households with children are eligible for the 2021 refundable CTC (with no earnings requirement).
Countries around the world are beginning to use their tax agencies in a similar fashion. But it is a challenge to layer these responsibilities on to a tax agency like the IRS that has an enforcement mindset and, right now, lousy taxpayer service, antiquated technology, and almost no geographic presence in the communities served by the tax benefits. Hence the name of the workshop series. You just can’t try to do this work with the same approach you’ve used for traditional tax administration. It takes imagination, vision, and a willingness to change.
Change starts with the articulated mission of the organization. A tax agency undertaking these tasks has to recognize that its mission is now a dual mission – that of revenue collection and benefits disbursement. They are equally important. Employees need to be trained on the purpose of the agency. It is no longer enforcement, enforcement, enforcement with a smidgeon of service. Benefits administrators must focus on increasing participation and receipt of the benefits by eligible individuals. While stopping improper payments is important, it is not paramount in a benefits agency – participation is paramount, and executives and managers should be evaluated on the basis of that measure. This is a major culture shift.
Culture shift is the topic of this video. We have a panel of folks who bring really different perspectives to the topic. The moderator was Gabriel Zucker of Code for America; panelists, in order of appearance, were:
- David Weaver of Catholic University of America and former Associate Commissioner, Social Security Administration Office of Research, Demonstration, and Employment Support;
- Patrick Keenan of Pennsylvania Health Access Network;
- Suran de Silva of Code for America;
- Josh Beck of the Taxpayer Advocate Service; and
The presentations are thought-provoking and practical. Everyone focused on how this can be done, even in an environment of limited resources. After all, culture change is a frame of mind. And that costs very little.
Enjoy the video! Let us know what you think.
All the best,
Nina E. Olson