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Why Tax Amnesty?
"It provides an opportunity for people
who have not paid their taxes to clear up obligations and have a
clean slate on the tax roll," explained Dana Mayton,
Secretary of the Kentucky Revenue Cabinet.
"It is a known fact that the state is
experiencing a shortfall in the general budget. The state has an
obligation to use every compliance method possible to bring in
back tax funds," said Kentucky Governor Paul Patton.
The General Assembly enacted KRS 131.445 as
the "Kentucky Tax Amnesty Act." For more information
go to www.amnesty.ky.gov or dial 1-877-ONLY-TAX.
The purposes of the Kentucky Tax Amnesty Act
are:
--To provide much needed additional revenues
for the 2002-2004 budget years.
--Enhance future tax collections by providing
a more equitable distribution of the tax burden by adding new
taxpayers to the tax rolls.
--To provide delinquent taxpayers an incentive
and an opportunity to become current on state taxes owed prior
to implementing the new compliance and enforcement programs.
--To minimize the underpayment and nonpayment
of taxes in the future through the enactment of increased
penalties and enforcement measures.
Kentucky Tax Amnesty Campaign of 1988: Fast
Facts
· The Kentucky Tax Amnesty Program of 1988
collected more than $61 million, far exceeding the collections
of comparable states in the same period. The KRC originally
estimated that the amnesty program would produce $10 million.
· A total of 18,761 applications for tax
amnesty were received from individuals and businesses, both
resident and nonresident. The breakdown of amnesty filers by tax
was: 32.2% Individual Income; 24.5% Sales and Use; 17.1% Omitted
Intangibles; 9.4% Other; 6.4% Individual Income Withholding;
5.1% Corporation License; 4.7% Corporation Income; and 0.6% Coal
Severance.
· One of the primary reasons for the success
of the Kentucky Tax Amnesty program was the inclusion of
accounts receivable.
· Taxpayer payments with amnesty applications
during the amnesty period ranged widely from a low of 14 cents
to a high of $4.6 million. Of the 18,761 applications received,
12, 092 or 64.5 percent contained payments of less than $500.
They accounted for only 2.84 percent of the total revenue
collected. On the opposite end of the spectrum, the 773
taxpayers (4.1 percent of the total applicants) paying $10,000
or more accounted for 77.23 percent of the total paid.
· The vast majority of tax amnesty
applications (12,298 or more than 65 percent) were filed and
payments were made during the last week of the amnesty period.
This is typical of the tax amnesty programs conducted by other
states.
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