Sound tax policy and administration decisions depend on comprehensive,
reliable, and timely information on taxpayer compliance. For about 30
years, the Taxpayer Compliance Measurement Program has been the Internal
Revenue Service's (IRS) primary program for gathering such information.
In 1991, IRS proposed a much smaller program because of criticisms that
it was too costly, too intrusive, and too untimely. In 1993, GAO
reported that the proposed changes would undermine the program's
usefulness and that the criticisms did not justify such a major change.
IRS now plans to conduct the most comprehensive Taxpayer Compliance
Measurement Program ever undertaken. Scheduled to begin in November
1995, it will include about 153,000 individual and business taxpayers.
In comparison to past surveys, this one should provide auditors with
more information and give them better tools with which to perform more
efficient, more effective audits. However, IRS has yet to meet some key
milestones necessary for the program, and the agency lacks enough
computers for all of its auditors.