The department announced with the recent addition of business taxes onto the system, it now has a fully integrated system for the taxes it collects and programs it administers accessible for all state taxpayers.
“This system is already used to process personal income tax returns and payments as well as rebates on property taxes and rent for older residents and Pennsylvanians with disabilities,” said Revenue Secretary Dan Hassell. “It has been very well received by the public so we are looking forward to expanding this resource for more people in the business community.”
Warren Hudak Jr., who runs a Camp Hill accounting firm that focuses on serving small businesses, said his firm has logged about 20 hours on the system since its launch last Wednesday.
“By all measures, this is a home run,” he said.
The system is intuitive, Hudak said, and provides real-time information, even allowing for businesses to set up installment and payment arrangements without involving a revenue department employee.
Among the new business taxes managed on what is call the “myPath” system are employer withholding tax, sales and corporation taxes, which combined make up a substantial portion of the revenue the state relies on to pay its bills and provide programs and services.
The new system is a far cry from the one in use when Gov. Tom Wolf served as the state’s revenue secretary in 2007 and 2008. That system relied on COBOL, an outdated computer language, which made it challenging to find employees who knew how to use it.
Among other shortcomings, it had various tax types operating on separate computer systems that couldn’t communicate with each other and it required employees to manually calculate interest owed on corporate tax accounts.
“I don’t think anybody even knows what COBOL is,” Wolf said in an interview last week. “So it was really important to get off of that … but I think it’s also important to have a system that can connect with the rest of the state” government agencies.
At the time the computer modernization project was launched, Wolf said he expected it would take five years, or to 2013, to complete.
But he admits, “there were some fits and starts.”
The original modernization project required the successful vendor, Accenture, a global technology consultant, to build a system using the same software program that other agencies under the governor’s jurisdiction used to provide consistency.
“As time went on, it became apparent that the software product offered by the vendor would not meet the long-term goal of the agency to move all of our taxes into one integrated system,” said Revenue spokesman Jeff Johnson.
All was not lost, though. Johnson said Accenture produced a $43 million tax system, which was in use from 2013 until the switchover last week.
Hudak did not have a kind word to say about the old system.
“It was a nightmare in that system to just figure out stuff,” he said. “We’re accountants. They are already killing us with policy. The last thing they need to do is kill us with technology. It was a double-edged sword. You couldn’t get stuff done. Then they were killing you with penalties.”
In 2018, the department entered into a 10-year contract with Fast Enterprises LLC, another global software and information technology company.
But unlike the custom system that Accenture had to build to accommodate a software requirement, Fast’s product is a “commercial off-the-shelf” solution, which Johnson said means it’s easier to install and maintain.
So far, the state has spent $62.9 million on the contract with Fast Enterprises. Johnson said the vendor will provide maintenance and support at an additional cost to ensure stability in the department’s tax administration while being responsive to taxpayers.
Johnson said the state will save roughly $10 million not having to maintain the old system.
Wolf said a new computer project encountering hiccups was not unexpected.
“In the private sector, I’ve never been part of a computer implementation that has been absolutely perfect,” he said.
After testing out the new system, Hudak considers the money well spent.
He gives Wolf, Hassell and their teams high marks for finally delivering an online tax system that he said accomplishes one of the Wolf Administration’s tag lines: “government that works.”
Hudak said, “I give them credit for taking this and fixing a serious problem the department had. This is getting the job done.”
As part of the transition, the revenue department is asking business taxpayers to register for a new account. Once logged in, they will have the option to migrate their existing access from the previous system to the new one, as well as have the option to enter their existing username and password to access any account information on the old system.
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