JEFFERSON CITY, Mo. — Inaccuracies in a computerized mapping system is requiring taxpayers in several Missouri counties to provide additional paperwork and go through additional steps in registering a vehicle, a new report found.
On Tuesday, Missouri State Auditor Nicole Galloway released the audit of the state’s sales and use tax collection processes, which are administered through the Department of Revenue. The report found inefficiencies affecting citizens at license offices throughout the state, especially in rural counties.
“Taxpayers should not have to provide the same documentation time and time again just to ensure they are not overcharged on tax for a new vehicle,” Galloway said. “Taxpayers deserve an efficient and effective system regardless of where they live.”
After a vehicle is purchased, the taxpayer is required to title and pay state and local sales tax. The Department of Revenue relies on a computerized mapping system to assign the appropriate local tax rate. However, in 15 counties that include rural communities, the system is often inaccurate, requiring taxpayers to produce additional proof of their residency in order to pay the correct rate.
Even after the information is provided, the address location is frequently not corrected in the system. This means the potential of repeatedly having the same errors, requiring taxpayers to once again produce additional documentation on future transactions.
“The Department of Revenue is constantly working to improve upon existing systems and processes and this is one good example of that. Our computerized system relies heavily on tax data sent by local jurisdictions; however, all taxing jurisdictions do not have robust addressing systems that pinpoint the ‘exact’ address in some instances. To the extent possible, the Department has made changes accordingly when local site codes can be verified,” said Missouri Department of Revenue Director Joel Walters.
The report also recommended changes to state law after a repeat finding regarding refunds on sales tax overpayments. This audit covered the 2015 through 2017 fiscal years, and lists the overall performance rating as “good.”
The previous audit of the state’s sales and use tax collection processes was released in 2015 and identified approximately $20 million in cash bonds being held by the department, which should have been refunded to Missouri businesses. The Department of Revenue has since addressed the issue and improved procedures to ensure businesses are refunded the money they are owed.
“Just a few years ago, our audit work identified a flawed process that resulted in millions of dollars not being returned to businesses,” Galloway said. “Audits get results. Today, there are processes in place to make sure this money is returned and can be invested in Missouri’s economy.”
The complete report on sales and use tax is available here.
Alisha Shurr was a reporter for The Missouri Times and The Missouri Times Magazine. She joined The Missouri Times in January 2018 after working as a copy editor for her hometown newspaper in Southern Oregon. Alisha is a graduate of Kansas State University.
