Mr. Steve Bennett, CEO,
Mr. Scott Cook, Founder,
Mr. Bill Cambell, Chairman
Intuit, Inc.
2632 Marine Way
Mountain View, CA 94043Gentleman:
I have been a user of Intuit products for almost ten years. I currently run my small business on Quickbooks 2007 and 2007 Payroll, and several businesses and enterprises which I have helped start also use Quickbooks – on my recommendation.
I’m about to start researching alternatives, for my business and others.
As a California resident, I was irritated by your successful efforts to kill the “Ready Return” program, in which the state Franchise Tax Board provided tools to allow simple filers to calculate and pay their own taxes – because it competed with your TurboTax products.
Here’s law professor Larry Lessig on your efforts:
In 2005, the state of California conducted an experiment. Hoping to make paying taxes easier, it launched a pilot program for people who were likely to file “simple returns.” The state already had the payroll information some taxpayers needed to file their returns, so it filled out 50,000 of those forms for them. Way in advance of the filing deadline, the state mailed the taxpayers their completed ReadyReturns. Like a Visa statement, the ReadyReturn itemized the taxes due, making the process easier for the taxpayer and more accurate for the government. People could either file the ReadyReturn or use the information to fill out forms on their own. Of taxpayers who hadn’t yet filed, 30 percent used the return; more than 95 percent of that group said they would do so again. Praise for the program was generally over-the-top.
Soon after ReadyReturn was launched, lobbyists from the tax-preparation industry began to pressure California lawmakers to abandon the innovation. Their opposition was not surprising: If figuring out your taxes were easy, why would anyone bother to hire H&R Block? If the government sends you a completed form, why buy TurboTax?
But what is surprising is that their “arguments” are having an effect. In February, the California Republican caucus released a report highlighting its “concerns” about the program – for example, that an effort to make taxes more efficient “violates the proper role of government.” Soon thereafter, a Republican state senator introduced a bill to stop the ReadyReturn program.
Inefficiency has become a virtue in government – and not just in California. Last year, the US Senate passed a funding bill with an amendment prohibiting the IRS from developing its own “income tax electronic filing or preparation products or services.”
Your efforts were successful:
Intuit lobbied hard to kill the free state program. It introduced “do no math†legislation to stop the free state software from performing calculations, thus rendering the program useless for taxpayers. It lobbied successfully this year to strip the Board of Equalization of funding to keep the free tax filing program alive.
While that was irritating, I’m deeply offended by your recent actions. In Tuesday’s election, State Controller candidate John Chiang has supported reinstituting the program. Your response? To donate a million dollars to an independent expenditure campaign for his opponent, Tony Strickland.
I can’t think of a more breathtaking effort to buy a favorable regulatory environment, or one that so consciously admits that your arguments wouldn’t succeed on their merits. Here’s Lessig again:
Imagine if tire manufacturers lobbied against filling potholes so they could sell more tires. Or if private emergency services got local agencies to cut funding for fire departments so people would end up calling private services first. And what if private schools pushed to reduce public school money so more families would flee the public system? Or what if taxicab companies managed to get a rail line placed just far enough from an airport to make public transportation prohibitively inconvenient? Pick your favorite of these outrages, and take note of how it makes you feel. You’ll experience it again when you read the next story – and this one, unfortunately, is true.
Count me a deeply offended customer, and one offended enough that I may not remain a customer. I’ll alert the readers of my blog when I finish researching alternatives and make the change.
Thanks for making such a good product; I’m sorry that you don’t trust the abilities of your team to build products good enough to win an audience without shaping the market in your favor.
Marc Danziger
You can tell them what you think of their efforts by clicking here.
Good luck taking on Intuit, and in finding a good alternative.
Though I’ve used Turbotax for years, it has been with ever increasing reluctance… The “Basic” version keeps getting ever less useful, and the price keeps mounting on the “Deluxe” and “Premium” or other upgrade versions that seem to justify their price by charging extra for features that used to be in the less-costly versions.
Each year, I have looked for alternatives, but in the end I have returned to Turbotax… only because I have each year received the program as a comp from an investment company, and at worst only have to pay the electronic filing fee (though that, too, keeps going up at an alarming rate).
I look forward to seeing the results of your research. Perhaps you will find a product I can use for my only-slightly-complicated tax situation (a few small investments, and a tedious-but-tiny foreign income exemption).
Again, Good luck with this effort!
DaveK
This is what I sent to Intuit:
“Your recent actions in California fly against the priciples of the free market, upon which, if I may remind you your company is founded. To know what I am talking about, follow this link.
http://www.windsofchange.net/archives/009193.php#comments
I have been a logn time user of TurbaTax, but I agree with the commenter DaveK, the program has gotten more and more expensive and has less and less utility. I am thinking of researching alternatives to your program and should I find one, you may have lost my business. I am sure you could care less, but maybe, just maybe the blogosphere can get something going to make you set up and notice.
Regards,
xxxx” [name redacted to protect the guilty]
Maybe if enough folks yelp, it can get their attention.
Or, just do what I do, don’t pay taxes.
We should go to a sales tax system, the everybody could pay their fair share based on consumption.
I’m a big hater of Intuit, and I’ve been a customer for many years.
Is the “planned obsolescence”, where they make sure their program stop working at a certain time? Is it the wheedling of extra features into new tiered groups every year?
It’s those things, and a lot more. Look — entering checks and balancing a checkbook is not that complicated a thing. Software companies are forced to add new bells and whistles each year to “re-solve” the same old problems they solved the last year, only better. That way they can get more money from you for doing the same thing.
This news about taxes just makes it worse. Intuit is obviously out to more to make money than to serve customers. Same as Microsoft. Good companies will kill off product lines if that means they can meet their long-term vision of helping their customer base. Large companies will not, due to shareholder and other issues. It’s an industry-wide problem.
They are no different than Frank Lautenberg and ADP. All government programs, no matter how noble in original intent, turn into sinecures for rent seekers. Intuit is only the most recent in a very long line.
I have to say that I can’t get too bent out of shape about Intuit’s actions. If I were a shareholder (which I’m not), I’d want the company to vigorously work to ensure continued growth and profits. Competition from the government, subsidized by all taxpayers, with pockets far deeper and inherent advantages greater than any private enterprise’s, does not foster a healthy business environment regardless of the nobility of the initial effort.
More appropriate alternatives might be to simplify the tax system so that we don’t have to buy computer programs to figure out what we owe, or providing the data the government was putting into the ReadyReturns in a neutral format to all tax software publishers. The amount we spend on tax preparation and handling is a significant drag on the economy, and the reduction of that drag should be a significant priority for a representative government.
(Of course, our government ceased to be truly representative a long time ago.)
We’re not talking about government competing with private business. Tax collection is -inherently- a government function. Increasing the efficiency and ease of tax collection benefits the entire population. Specifically, the government has a significant fraction of the data you need to file your taxes, because it’s sent to them directly from most of your sources of income; sharing this information with you to make your taxes easier to calculate is -eminently- reasonable.
AL, mind finding out exactly which Republicans were responsible for killing it in the first place? I should send an e-mail of my own…
Intuit acted in self interest? I’m shocked, I tell you, shocked! I suppose I could muster more outrage if Intuit had a monopoly on tax software, but they do not. Their escalating pricey versions with myriad useless features invite competition in the market.
I am not even tempted to do my own taxes, as I am not familiar enough with the laws and am content to have my CPA with a tax practice do and file them electronically, incidentally not using Intuit software. The last thing on earth I want is the damned government doing my taxes for me.
I’m more outraged at Tony Strickland than at Intuit. He’s the one with the public duty he appears willing to compromise for personal power.
Intuit seems to be engaging in an expensive market strategy that’s unsustainable. What’s it going to do, buy every politician in the country every two years until the end of time? Its tax product is based upon public information that could be re-created by any halfway decent software manufacture and a team of tax lawyers.
And from my experience its state tax software (Illinois) is not worth anything.
Daniel — to be fair on the planned obsolesence front, there are enough changes to state tax law every year that it’s simply not possible for last year’s version of TurboTax to work this year without a patch, and there’s absolutely no reason why the patch updating the software to handle the latest changes in tax law should be free.
All you folks saying there’s no real alternative–did TaxCut cease to exist?