Candidate for
State Board of Equalization; District 4

I will continue to push for innovative ways to reduce tax evasion and the underground economy. For example, tax amnesty provided an opportunity for taxpayers to come clean on taxes due. The threat of increased enforcement and higher penalties after the amnesty period served as a disincentive for taxpayers and tax advisors to aggressively pursue questionable tax avoidance schemes. As a result, the state collected over $4 billion in tax payments.

I will fight to enhance Board enforcement and audit staff. The Governor's 2005 proposal to spend nearly $9 million in order to collect only $34 million in unpaid taxes was absolutely inadequate in light of the estimated $6.5 billion of outstanding uncollected taxes. The state needs to find the most efficient use of audit and enforcement staff and provide better communication between enforcement agencies. A good first step would be to upgrade the computers used by the Board and provide better incentives to keep experienced audit staff. Too many of the computers used by the Board are obsolete and need to replaced with ones that can better coordinate with other tax agencies and aggressively ferret out tax evasion and fraud. Every year, the BOE loses talented audit staff who are wooed away by the corporations that are being audited. As a result, the BOE loses its best tool against corporate tax fraud: experienced auditors.

I will crack down on overly aggressive tax advisors, tax attorneys and abusive tax shelters. Several newspaper accounts have pointed to an increase in questionable tax advice and the proliferation of abusive tax shelters. The state needs to follow the IRS lead in pressuring tax advisors, tax lawyers and tax consultants to follow strict ethical guidelines that protect the interest of their taxpayer clients.

I will vote to close egregious tax loopholes that allow corporations to evade taxes. For example, the Franchise Tax Board found that one company was liberally interpreting the law to assist a corporation to claim tax credits for jobs in one locality that actually existed over 300 miles outside of the tax credit zone. In another egregious example, the Board of Equalization voted to give $82 million in tax refunds to corporations that paid no California income taxes.

Over 2,000 businesses appeal their tax bills to the Board of Equalization annually. I want to make sure that small businesses get a fair shake and that state tax administration is designed as "help up" for small businesses. According to the U.S. Census, over 27% of California's 2.9 million businesses are owned by women and nearly 29% are owned by minorities. I want to help women and minority businesses through BOE tax assistance programs, BOE tax seminars for women and minority-owned businesses, and the BOE tax appeals process.