From today's SmartPros newsletter comes a fascinating story about tax compliance that I invite you to think about in the context of copyright compliance in digital music, Internet content and the like, as well as the role that an actively-managed Creative Commons licensing system might play. The article is called Taxpayer Advocate Says Voluntary Compliance Is Key.

From the summary:

"Excessive focus on enforcement at the expense of taxpayer service could have the effect of both reducing voluntary compliance and alienating taxpayers, according to a report delivered to Congress last week."

The money quote:

Commenting on taxpayer service research, Olson points out the IRS strategic plan for 2005-2009 -- "Service + Enforcement = Compliance" -- and states that the IRS has not conducted research seeking to determine the optimal allocation of resources between service and enforcement. "Consequently," Olson writes, "the IRS does not know whether recently proposed reductions in customer service will save the government money, since the potential impact on taxpayer compliance can not be quantified."

As we try to determine what you can and can't do in putting music you think you already own on iPods and how you can use music legally on your podcast, it is a worthwhile exercise to think about ways to set clear guidleines and make it easy for people to comply with the law. If you make it easy for people to comply with the law, they generally will comply with the law.

Here's a great example. I listened to a podcast interview with Brian Ibbott of Coverville on Podccast 411. The interview is a tremendous resource for anyone who uses or wnats to use music on a podcast. I listened to all the efforts Brian has made to talk to the appropriate people to get the licenses he needs to use music on his podcast. His experience has been Kafkaesque. There comes a point in the interview where he says that he hopes that they won't come after someone like him who has made a concerted effort to comply with the law and the licensing procedures and instead focus on people who have made no efforts. He then acknowledges that he's not sure that he hasn't made himself a bigger target by trying to do the right thing in a public way. That's sad.

If, ultimately, you are after more of the revenues that you are entitled to, is it better to focus on making it easy for people to voluntarily comply or spending most of your money and effort on expensive enforcement efforts that generate ill-will and negative publicity? In copyright aas well as taxes, should we be tipping the balance more toward voluntary compliance than on enforcement?