Tata Info helps Valley collect tax

By siliconindia staff writer   |   Wednesday, 19 May 2004, 07:00 Hrs
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Three Silicon Valley cities are spending over $2.8 million in tax dollars in India to collect sales levies in America. The beneficiary? Tata Infotech.

And this despite the routine pitch made by the cities: “Shop locally and keep those tax dollars at home.”

Of the cities, Tempe is spending $1.3 million, Peoria $830,000 and Chandler $727,995 to create city sales-tax collection and business-licensing systems.

A report by azcentral.com says, The Chandler City Council voted 5-2 last week to make the deal. Peoria and Chandler are using Tempe's 2001 contract; neither sought public bids or proposals.

Last month, Governor Janet Napolitano had announced that all future state contracts will require work be done in the US. The announcement came after she learned that telephone inquiries from state welfare and food-stamp recipients were being routed to call centers in India and Mexico.

The reason for her decision, she said in a memo, was "due to security and identity protection concerns."

But the Valley cities’ officials say they are simply looking for the best deal by taking their business abroad.

"It makes me feel better that it's a product, not a service," Chandler Mayor Boyd Dunn said of the tax-collection system contract. "Chandler has always been focused on the customer, on doing things more efficiently."

Another Valley city, Scottsdale, is also looking for a new tax and licensing systems but decided to seek public proposals and not use Tempe's Tata contract.

The US-based Unisys , had sought the Tempe contract but was not selected. Company officials did not respond to requests for interviews. The company Web site shows Unisys has done work for Chicago and Minneapolis and California.

Chandler’s decision to shift the service to India, got it a lot of flak. Laurie Stevens, Chandler's tax and utility services manager, said her city would be saving time and money by using the program Tata is developing for Tempe.

She expects the system will allow the city to eliminate a technical position in the department, collect more tax dollars and process business licenses and tax payments electronically.

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