The Texas Legislature sets tax rates and creates criminal offenses related to the taxation of tobacco, motor fuels, motor vehicles and sales, as well as various governmental records.
Tax crimes are as diverse and complex as Texas business and industry themselves. Cases may involve individuals or corporations; simple plots or convoluted schemes; and a single site or multiple locations.
Investigations may be initiated in several ways including data mining, inspections, referrals, audits and tips. Most Criminal Investigation Division cases deal with one of these areas of state revenue and finance.
Voluntary compliance with the tax laws is vital to the well-being of state government and the efficient operation of its programs. The vast majority of Texans pays their fair share of state taxes voluntarily; the few who don't penalize those who do. They harm all Texans by diverting funds intended to support important governmental functions and services.
That's where the Comptroller's Criminal Investigation Division (CID) comes in.
Since 1992, the Criminal Investigation Division (and its predecessor unit, the Tax Fraud Section of the Audit Division) has combined specialized financial investigation with traditional law enforcement to detect tax law violations and prosecute individuals and business entities committing tax-related crimes. The Criminal Investigation Division has experience investigating complex criminal organizations in both tax and other legal contexts.
CID employs full-time state police officers commissioned by the Comptroller under the authority of the Texas Code of Criminal Procedure, Article 2.12(13) and Texas Tax Code Section 111.00452.
The investigative staff includes:
These diverse backgrounds enable comprehensive investigations of tax-related crimes from a variety of perspectives.
Headquartered in Austin, the Criminal Investigation Division has statewide jurisdiction as reflected in its 13 regional field offices.
The State of Texas has a financial interest, as well as a fiduciary duty, in enforcing its tax laws. Consequently, since 1981 the Comptroller has had the legal authority to conduct administrative searches, called 'inspections," in a number of tax law contexts. These warrantless searches are defined in statute as to time, place and scope.
The authority to conduct an inspection is tax specific. Each individual Tax Code chapter sets forth the particular administrative search authority granted for that particular type of tax. Most statutes authorize inspection — during regular business hours at the business's location — of books, records and equipment relating to that business. State law usually requires such records be kept four years. For motor fuels tax investigations, Comptroller personnel also may inspect premises and sample specific products.
Some parts of the Tax Code authorize administrative seizures of taxable products as well as property used by persons intending to avoid payment of taxes, including automobiles, equipment and other tangible personal property.