California – BOE’s Latest Issue of Tax Information Bulletin

SALT Report 2512 – The latest edition of the BOE’s Tax Information Bulletin newsletter, discusses their position on audits using electronic records, the Centralized Revenue Opportunity System, and the new district tax rate that will take effect on July 1, 2013.

Auditing Electronic Records

Since most businesses keep their books and records in an electronic format, the BOE is implementing what they call “computer-assisted audits.”  Regulation 1698 -Records, allows the BOE to access all records, including electronic records and data that are part of a business’s books and records during an audit.

The BOE’s use of electronic data to complete an audit will allow the auditor to easily determine the accuracy of the businesses tax reporting. This will save the business time and money as it reduces the time the business and their employees must devote to the retrieval of paper documents. Additionally, the computer assisted audit will dramatically reduce the volume of paper documents needed to complete an audit as it requires fewer supporting documents, such as invoices, resale certificates, and shipping documents.

Centralized Revenue Opportunity System

The Centralized Revenue Opportunity System (CROS) will replace the BOE’s current computer systems with an updated customer-centered application. The CROS system will benefit businesses by maximizing the effectiveness of BOE staff and will generate an estimated $200 million in previously uncollected revenue by:

  • Expanding online business services for customers
  • Allowing customers to communicate with the BOE at any time, and
  • Employing technology that will reinforce accuracy and security

The CROS project is currently in its pre-implementation phase. During this phase, the BOE is updating their business rules, gathering data, and developing a system inventory.

The BOE is in the process of defining the scope and functionality of the CROS project and is drafting a Request for Proposal (RFP). Once the RFP is approved by the Department of General Services and released to the public, vendors will be eligible to submit proposed solutions.

New District Tax Rate

Effective July 1, 2013, the city of Atwater will increase its district tax rate from 7.5% to 8%.

For Further Information

California State Board of Equalization – Tax Information Bulletin, June 2013