1 877 422 8729

Today is Tax Day and T. Lau at EnterpriseITPlanet.com asks an interesting question about our tax process:

As last minute filers rush to the post office, or as is more likely with this crowd, log online to file electronically, you are probably wondering why, in 2010, the IRS isn’t a more tech-savvy enterprise. Why can’t you file forms (like extensions) electronically, for example? Or look up past tax returns and refund or payment history? Most Americans readily accept online security measures with banking and credit card companies as perfectly adequate, so why the quill and paper methodology?

As I’ve written about earlier on the blog, the federal government is looking to new technologies to streamline the work of their agencies and cut costs. According to Lau, the government now owns about 10 percent of data centers in the U.S. But the trend has been for the government to switch to the cloud because virtualization allows the government to become significantly more efficient (the Brookings Institution, Lau writes, estimates that the federal government will cut down 25-50% of costs).

So, why hasn’t the federal government switched to completely digitizing the tax system? First, some people especially of the older generation may not be tech-savvy and would have a hard time with a digital tax filing process. In addition, eliminating a paper trail is a risky proposal in government because digital records can be manipulated much more easily than hard copies by those who choose to abuse power. The government and especially the public will have to balance competing priorities – like government efficiency with personal liberty – to arrive at a compromise that best utilizes the computing technology available.