September 1999

By Louis Grumet

What do you see as your greatest challenge as Tax Commissioner? How has your experience as a CPA practitioner prepared you?

I look at the future as being full of opportunities. This may seem optimistic, but I believe it's justified when you reflect on New York's unprecedented transformation during the years of Governor Pataki's leadership.

As for the department, we are in the midst of a monumental cultural revolution resulting from the total quality management (TQM) initiative started by my predecessor, Michael Urbach. Governor Pataki is steadfast in his support of this initiative, and, as a result, we continue to obtain the resources to improve employees' work environments, upgrade our technological capabilities, and provide employees with the tools and resources they need to do their jobs better. But cultural changes take time, and there is still much to do.

I am totally committed to the continuation of this cultural change--it is my greatest responsibility. The department could implement many individual process improvements during the next four years but I don't think they would be as far reaching or effective as a continued commitment to our TQM initiatives. The process of change is never ending, but once fully integrated, TQM's basic principles, such as customer focus, open communication and partnership with our customers, will result in deep-rooted change. From the perspective of our employees and the taxpayers who received services from this department, TQM along with unprecedented tax cuts and the rebuilding of the economy, will represent the Governor's legacy for future generations of taxpayers.

During my years as a CPA, I've had firsthand experience in dealing with the day-to-day realities of running my own business, meeting customer needs, and dealing with bureaucracies. I was involved in process re-engineering while I was at Coopers and Lybrand. I've seen clients who suffered under the burden of taxation and tax administration to the point where they were either shutting down or moving out of state. This was wrong. These experiences have left me with some firm beliefs about our tax system, running a business, and dealing with clients: New York's tax policy and economy are inextricably related; customers should be treated as active participants and partners, not as adversaries; communication is key and involves more listening and less talking; fairness should always prevail; and employees, your most valued asset, should be treated as you would want to be treated.

I understand the needs of the business and practitioner communities. I will not abandon the above principles and I believe they are fundamental to helping this department reach its full potential.

What long-term goals do you have for your administration?

Quite simply, "quality" must become the norm--the way we get things done.

We often hear the term "taxpayer friendly," but I think the department's responsibility goes much further. We have to ensure "taxpayer fairness"--fairness not only in the rate or amount someone pays in support of government services but fairness in the way we interact with taxpayers. We ask a lot of our taxpayer and practitioner communities but too often the process is unnecessarily burdensome and filled with uncertainty. When a business person has to devote an inordinate amount of time to comply with complex laws and requirements instead of running the business, then something is wrong. Or if taxpayers make good faith efforts to comply, and face problems, then we have failed them. Government is supposed to help people; we need to do more.

Our long term goal is to alleviate these kinds of concerns and instill greater fairness and simplicity at every point in the process.

We must continue to reevaluate and improve all of the processes that impact our customers. I see technology and the Internet as our link to the future. Businesses are quickly adopting electronic commerce as the norm and we have to keep pace.

The possibilities are limitless. We have to strive for a system where easy-to-understand forms and instructions are available on the Internet--a system where taxpayers can easily determine and meet their responsibilities, file returns, and arrange payments electronically. I envision a system where taxpayers can access all of their account information online, easily, 24 hours a day, seven days a week.

What tax changes do you have planned to make New York more attractive to businesses trying to relocate?

Thanks to Governor Pataki's efforts, New York has already reduced taxes, eliminated red tape, and imposed sound fiscal policies which are leading to more jobs and a strong business climate. His programs and related tax cuts have helped create 508,000 new jobs. This year's budget is a continuation of those themes delivering $1.7 billion in previously enacted tax cuts that were scheduled to take effect this year while also providing $250 million in new tax relief.

We need to work with other state agencies to make doing business in New York faster, cheaper, and easier. A perfect example of this is our joint effort with the Department of Labor, which allows businesses to file their withholding tax and unemployment insurance in one place--a "one stop shopping" experience.

As I mentioned earlier, expanding the available information on the Department of Taxation and Finance's website, along with electronic filing of extensions (and someday all returns) will assist businesses greatly in their efforts to satisfy their tax responsibilities.

You served an NYSSCPA Northeast Chapter President during the 1980s. How can the Society work with you for the benefit of taxpayers?

The old days of "them" and "us" are relics of the past. If the department has learned anything over the last four and a half years, it's that we don't have a monopoly on good ideas, and we can't meet taxpayer needs if we don't understand their problems.

That's why we've taken unprecedented steps to create positive relationships and partner with all who are stakeholders in the system. The Society and its members are in a unique front-line position where you can observe and assess the appropriateness of the department's actions not only as they relate to an individual taxpayer but also as they impact broad classes of constituents.

We need to maintain open lines of communications so the Society can help us identify areas in need of improvement and provide the expertise necessary to develop solutions. We can't do it alone.

There is no better way to develop the best processes and policies, and minimize problems than to have the Society and other stakeholders participate in the review and/or development of new regulations, forms, systems, procedures, and the like before they are put in place. We have involved the Society in these kinds of activities, and we plan to do even more.

On August 4, members of my executive staff and I met with various Society members and staff persons to discuss ways we may continue to improve relationships between the NYSSCPA and the department. This was our first meeting since I became commissioner, and while we kept our remarks somewhat general, we identified many areas for future discussion including our administrative procedures, notices, and forms; audit and collection practices; the exchange of knowledge; communications both with the Society and with taxpayers; and legislation.

Most important, we agreed to a series of meetings and exchanges in the future. I consider the Society a valuable resource and partner for the department and the taxpayers we mutually serve. *