Bad news for tax scofflaws.

The state is continuing to make strides in collecting delinquent taxes, reaching collection records while whittling down the amount that past-due taxpayers owe it.

The state Department of Taxation scooped up $263.1 million of taxes that were past their due date. The total for the year ended June 30 was almost $29 million more than a year earlier.

At the same time the delinquent balance fell to $319.7 million, its lowest level in four years.

The state is reaping the benefits of a strong economy in which people have more money to pay off tax delinquencies and enhanced efforts at the tax department to collect payments that are 30 days past due. In recent years the department has added staff positions in its compliance division and has fine-tuned use of a computer system that allows it to ferret out inconsistencies in state income, general excise tax and federal income tax filings.

"They have tools that they didn't have 10 years ago," said Lowell Kalapa, head of the Tax Foundation of Hawaii, a private tax research group. "Hopefully they'll continue to use those tools well."

The increase played a role in overall state tax collections climbing last year to $5.1 billion and was the fifth consecutive year the tax department has set delinquent tax collection records. Last year's delinquent tax take of more than a quarter billion dollars compared with the $113.1 million collected in 2002.

"We're not trying to squeeze every dollar out of every taxpayer," said state Tax Director Kurt Kawafuchi. "We're trying to collect the right amount."

In part Kawafuchi is benefiting from the installation of a computer system that began under his predecessor, Ray Kamikawa. Kawafuchi said the department's computers for individual income taxes and business taxes weren't linked and it was difficult to find inconsistencies.

For example, someone who wasn't paying a $1,000 general-excise tax bill could receive a $5,000 income tax refund without the state knowing it. With the computer system, the taxpayer's records will be checked and the tax bill found. Instead of receiving a $5,000 refund the general-excise tax will be deducted and the taxpayer will get back $4,000 instead.

The computer system cost $53 million. Kawafuchi said it's generated at least five times that amount in terms of new collections.

"That's a nice payback," he said.

The tax department also has added more auditors and taken on special projects such as auditing of some Mainland companies that do business in the state. Its staff also is working hard to turn egregious delinquencies into criminal cases. A single collector last year set a record by collecting $2.3 million in taxes, penalties and interests in what was owed in criminal cases.

Kawafuchi said the enhanced enforcement also is paying dividends with more people taking notice and paying their taxes on time.

Delinquent collections have been keeping pace with last year's totals so far this fiscal year, Kawafuchi said. But he declined to say whether a record for the collections will be set in fiscal 2007, though the department is still looking at further enhancements to the computer system.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.