affects data processing just as it does our compliance work. The new service centers are central to our success in keeping abreast of this workload. And, additional staffing and equipment to bring them into full operation are an important part of our request. The Centers at Memphis and Fresno began operation in January; and the Brookhaven Center is to begin some parts of its operation this coming July. These new Service Centers culminate a long range project which will come close to completion in FY 1973. Also included in our Data Processing request is the service center staffing increase necessary to carry out the Unallowable Deductions Program mentioned earlier in connection with Audit. Data Processing Equipment Eleven million dollars of our requested increase is for data processing equipment. Chiefly, it is needed to allow purchase of Direct Data Entry System (DDES) equipment where lease credits will cease to accrue. We believe the Committee is aware of the added efficiency this system has brought to the service centers by dispensing with punch cards and allowing direct entry of tax return information into the computer system. It would be uneconomical to fail to purchase this equipment when there are no longer credits accruing from our lease payments. Integrated Data Retrieval System Funds to install the Integrated Data Retrieval System (IDRS) nationwide in FY 1973 are another important item in our equipment request. IDRS, with which we believe the Committee has some acquaintance, is a network of electronic communication between service center computers holding tax account information, and district and local offices where the information is needed for assisting taxpayers or for use in collecting delinquent taxes. The information is conveyed almost instantly and displayed on video screens at points where it is requested, thus serving as a ready, up-to-date file of tax account data for IRS field offices. With IDRS we can usually resolve a taxpayer's problem or question in minutes, even while he waits on the telephone, saving him visits, calls or correspondence. It also makes collection of delinquent taxes a surer, more error-free task by providing Collection personnel with the up-to-the-minute status on accounts. We view IDRS as a major improvement in the Service's ability to respond responsibly in its dealings with taxpayers. This ADP equipment not only adds to IRS effectiveness, it helps hold down manpower requirements. IDRS, together with the Direct Data Entry System, now operational in nine service centers, will save 557 man-years for Data Processing in FY 1973 and more in the following year when IDRS is in full operation. Transfer of Collection from Compliance to ACTS The transfer of Collection from Compliance to ACTS was one of the reorganization's chief changes; the other being creation of the Taxpayer Service Division in the National Office and its similar emphasis in the field. One of our purposes in putting Collection in ACTS was to align it under the same functional management with Data Processing Operations with which its programs are interconnected. Relying as they do on computer issuance of delinquency notices, Collection programs will become more immediately connected to service centers with the extension of IDRS. We believe that fuller use of computer capability in support of Collection programs will be ens hanced by the new organization and appropriation structure. We do not believe that our Collection programs are adequate and we have been making adjustments to get the most effect from We are planning to revitalize our Returns the staff we have. Compliance Program, whose purpose is to get nonfilers on the tax rolls. We are mindful of the Chairman's views on the seriousness of the nonfiler problem and share his opinion that more must be done to identify and correct those who are bearing none of their share of the tax burden. Our request contains 749 additional man-years for Collection. This proposed increase, in conjunction with adjustments we are making, will enable us to reduce the backlogs of delinquent accounts and do much more in the nonfiler area. If our request is approved, manpower applied to returns compliance work would jump from 87 to 400 direct man-years. About 260 thousand more nonfilers could be put on the rolls in FY 1973 as a result of this added emphasis. In Collection, as in Audit, the Government's investment in better tax administration is repaid many times over in additional revenue (17 to 1). (Chart 12) Taxpayer Service Another object cf the ACTS reorganization is better taxpayer service. With a newly formed Taxpayer Service Division this important activity will be receiving the high level attention and coordination it deserves. Among our responsibilities in tax administration we have none more important than being sensitive to taxpayers, and responding with a sense of urgency to their needs for assistance and information. Taxpayer service covers a broad front. It requires a staff of courteous and well trained personnel in all our field offices to handle taxpayer inquiries and requests for assistance. meet this basic need, we are including in our request 44 additional taxpayer service man-years. ΤΟ There are other developments which add greatly to the effectiveness of our staff, and, indeed, limit the staff needed for |