Killing a good public service -- for private profit

For-profit companies that sell tax-filing software are lobbying hard to kill off their competition from free, voluntary online services provided by states. Taxpayers will be double losers if they are forced to pay fees for what is now an efficient public service, while the change drives up states' administrative costs.

In California, Intuit Corp. has spent more than $3 million on lobbyists and campaign contributions in its effort to eliminate two free and very popular programs that help taxpayers calculate and file their taxes. The state programs, ReadyReturn and CalFile, save taxpayers between $4 million and $10 million a year in preparation costs -- with a 98% satisfaction rating from users -- while saving the state about $500,000 in administrative costs.

With strategic campaign donations, Intuit and other software companies have killed a similar public program in Virginia. In exchange for providing free filing for lower-income filers, a for-profit consortium will be able to charge other people for what was previously a free service. Costs to the state will increase as some taxpayers revert to paper returns.

We all pay taxes, and governments have a responsible role in making the process efficient and affordable. If profit-making companies can't compete, it makes no sense to clear the way for them by shutting down a good public service. Join the California Budget Project in sending that message to legislators.