Our tax return data going to IBM? Will we be profiled by the Revenue Department?

In both the House and Senate Government Finance bills there is a provision of law that could allow our personal income tax data to go to third parties for a process called tax analytics(Senate-Article 3 Section 47) and another provision(House-Article 3 Section 58) which will put a score rating on the 3.7 million taxpayers of Minnesota, in other words to be profiled.  Each provision is directed to achieve better tax compliance of individuals and business.  The Senate provision may also do profiling and scoring of all Minnesota taxpayers.

Two different approaches by each body.  Both provisions introduced as bills, but never went to the appropriate committees for public hearings as it relates to privacy, due process, and security for the most intimate of our personal data, our financial information.

The House provision is a combination of using data bases, then goes through a process to evaluate and score each individual who files.  Based on testimony through the committee process no data would leave the Revenue Department.  What the request for proposal would do is get a software which may be within the Revenue Department to analyze us, to gather financial intelligence on us from possible data bases and other sources, and then score us, rank us, which the government then would use to act on.  I wonder if this version becomes law will we be able to see our financial score/dossier?  A company called SAS Institute appears to have been consulted with the House proposal.  They also testified on the bill.

The Senate version goes through a request for proposal process to where our tax data it seems would go to a third party for analysis.  What is unique with this proposal is that it has a proof of concept idea.  Basically, it means that the idea of analysis will be done on a limited basis to see if it works.  If it does work and gives savings to the state, the Commissioner of Revenue it seems is bound by law to set up this profiling system of us.  I shared some concerns with Sen. Limmer, he did a couple of amendments that required special attention to privacy issues.  IBM has been involved in helping the Senate version go through the process.  There were questions by Senators throughout the committee process about the role of IBM as it relates to the bill.

The bottom line is that both of these proposals did not go to the appropriate committees for venting on privacy and due process concerns.  Each proposal presents issues of profiling and surveillance of taxpayers, equity, equal treatment, accountability and transparency, and oversight.   Both proposals are being sold to be used and operated to enforce compliance of our state tax laws.  Both proposals affect the collection, use, and dissemination of our tax information.