US Public Will Pay $602 Billion in Taxes Online by 2006

Despite funding struggles and bureaucratic inertia, eGovernment will change the way authorities deal with their citizens. According to a new report from Forrester Research, federal, state, and local governments will collect 15% of taxes online by 2006 – a total of $602 billion.

“An increasingly demanding and wired public is looking for speed and convenience from its government,” said Jeremy Sharrard, associate analyst at Forrester. “Even though constituents are concerned about privacy and convenience fees, they see the value of online government and want those services now.”

Most government services involve the filing of an application or report, and governments will receive 333,000,000 online submissions by 2006. By 2006, authorities will have rolled out almost 14,000 online service applications nationwide. Most of these will come from the nation’s 35,000 cities and towns.

eGovernment will be adopted through three phases: experimentation, integration, and reinvention. Over the next two years there will be a smattering of low-risk, clearly bounded services online. Applications will be simple, posing little threat to privacy, and requiring little in the way of identity authentication. Volume will be low, because 90% of cities and towns won’t be offering eGovernment services until 2002.

Citizens’ expectations for online government will rise quickly as they incorporate private sector eCommerce into their daily lives. Governments will respond with business services as well as more sophisticated offerings that must be integrated throughout departments. But linking different legacy systems will slow progress, as authorities struggle to tie their systems to new payment services.

Once lawmakers can see the structure of their government laid out before them on the web, they will ask why so many departments’ services overlap. By building easy-to-use sites, government will eventually become less visible and constituents will become more autonomous.

“By 2005, local governments will receive federal funding to bridge the digital divide – making eGovernment services available to all,” added Sharrard.

For the report, ‘Sizing US eGovernment’, Forrester interviewed CIOs and other heads of federal, state, and local governments that have already taken to the net, as well as five international governments.

Forrester Research is an independent Internet research firm, which analyses technological change and its impact on society. The company’s headquarters are in Cambridge, Massechusetts, and research centers in Amsterdam and London.

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