Discussion with DOR regarding withholding error continues in special committee

   

JEFFERSON CITY, Mo. — A House committee dedicated to government oversight continued digging into the reason behind the lagging state revenues and Missourians’ expected refund decrease.

At the Wednesday meeting of the Special Committee on Government Oversight Joel Walters, the Director of the Missouri Department of Revenue, was once again in the hot seat. He has previously testified publically on the issue three times — to the House budget committee, the Senate appropriations committee, and the House oversight committee — and is expected back before the oversight committee again next week.

Committee members from both sides of the aisle had an array of questions seeking specifics on timeline, impact, and outreach. Some were more satisfied with the given answers than others.

“I have made some judgments and there has been a lot of complex tax rules to work through, and 2018 is a transition year and it is having big impacts on everybody — if you are reading national press you can see this — and it all comes down to do could I, and should I, have done a better job of communicating this, better and early, and I am on the record saying ‘I absolutely should have,’” said Walters.

In recent months, the Department of Revenue has increased its awareness campaign. Walters noted that they have started a social media campaign, there soon will be a video on their website, mailers will be distributed, fliers sent to businesses, and more.

But the chairman of the committee, Rep. Robert Ross, still isn’t satisfied.

“The memo is not getting out there, Director,” said Ross.

Roughly 3.6 million tax returns are filed, many being joint returns. The Missouri Department of Revenue has 2,350 Twitter followers and 982 Facebook followers.

“There have been two posts relative to the ‘review your W-4’ and the three posts relative to assistance and payment options. Do you really think that qualifies as a social media campaign?” Ross asked Walters.

“I don’t know,” he answer. “We are doing all the things I have listed a couple of times.”

On Monday, Walters provided the committee with a variety of examples in different scenario on the impact to taxpayers. He reiterated that state tax refunds are about $80 lower than a year ago. Under questioning by Rep. Peter Merideth, Walters recognized that those most impacted are taxpayers earning less than $60,000 annually.

That decrease in refund is two-fold, according to Walters. Not only was there a long standing error in the withholding tables but the federal tax overhaul transitioned away from itemization to the standard deduction, which was doubled.

Merideth pressed Walters for specifics to the impacts between the withholding error and the tax implications. The St. Louis lawmaker noted that following the withholding table changes in March 2018, some Missourians saw their withholdings decrease by as much as a third.

“The amount withheld fell by more than the tax cut,” said Walters.

Merideth wanted to know how much of that decrease was attributed to the withhold error verses the federal changes. Walters was hesitant to share any figures because any number would just be a guess on his part.

Walters will be back again next Wednesday to continue answering questions.