Tax Administration 2019 Comparative Information on OECD and Other Advanced and Emerging Economies

Table of contents
Preface
Foreword
Acknowledgements
Abbreviations and acronyms
Executive summary
	Figure 0.1. Key figures related to the administrations covered in this publication
Reader’s guide
	Notes
Part I. Comparative information on tax administration
	Chapter 1. The changing tax compliance environment
		1.1. Introduction
			Box 1.1. Innovation
			Figure 1.1. Innovation index, 2017
		1.2. Supporting positive compliance attitudes
			Figure 1.2. Tax gap analysis 2015 vs. 2017
			Table 1.1. Taxpayer satisfaction surveys by taxpayer segment, 2017
			Table 1.2. Evolution of on-time filing rates (in percent) between 2014 and 2017
			1.2.1. Education and the communication of social norms
			Table 1.3. Selected special educational and business support initiatives, 2017
			Box 1.2. Educational and communication initiatives
			1.2.2. Taxpayer services
			Figure 1.3. Relative priorities of key aspects of tax administrations service and assistance strategy
			Box 1.3. Engagement with taxpayers to improve services
			Table 1.4. Service demand by channel
			Box 1.4. Approaches to meeting and managing demand
			Table 1.5. Provision of e-services and tools to support self-service, 2017
			Box 1.5. Supporting self-service
			Table 1.6. Services provided via mobile applications, 2017
			Box 1.6. Mobile app and tax
			Box 1.7. Joined-up services
			1.2.3. Behavioural insights and the use of “nudges”
			Box 1.8. Behavioural insights in SMS campaigns in Australia
			Table 1.7. Outcomes of the Short Message Service (SMS) Campaigns
		1.3. Compliance risk management
			1.3.1. Increasing availability of data
			Figure 1.4. Use of third party data, 2017
			Box 1.9. Use of data in large scale compliance intervention in Italy
			Box 1.10. Compliance and the platform economy
			1.3.2. Sharpened targeting of risks
			Box 1.11. Use of data analytics in risk assessments
			Figure 1.5. Percentage of revenue collected through large taxpayer offices/programmes, 2017
			Figure 1.6. Large taxpayer offices/programmes, 2017
			Figure 1.7. HWNI programmes, 2017
			Box 1.12. HNWI compliance strategy in Romania
			1.3.3. Co-operative compliance and transparency
			Figure 1.8. Cooperative compliance approaches: Existence and implementation status, 2017
			Figure 1.9. Cooperative compliance approaches: Features and requirements, 2017
			Box 1.13. Cooperative compliance approaches
			Figure 1.10. Tax certainty: Routes to certainty for international tax risks
			1.3.4. Automated risk management
			Box 1.14. Automatic checks and actions
		1.4. Compliance-by-design
			1.4.1. Personal income tax
			Box 1.15. Compliance-by-design for employees
			1.4.2. Upstreaming of compliance management
			Figure 1.11. Electronic invoice systems: Existence and selected features, 2017
			Figure 1.12. Electronic invoice systems: Usage, 2017
			Box 1.16. Uninterrupted chains
			Figure 1.13. System architecture of the Russian OCR system
		Notes
		References
	Chapter 2. Responsibilities and collection
		2.1. Introduction
		2.2. Responsibilities of tax administrations
			Table 2.1. Tax types collected by the tax administration, 2017
			Figure 2.1. Tax administrations wider roles, 2017
			Figure 2.2. Nature of assistance provided to SSC agencies, 2017
			Box 2.1. Assisting citizens in receiving benefits
		2.3. Tax collections
			2.3.1. Net collections by tax administrations averages 20% of jurisdiction GDP
			2.3.2. Net collections by tax administrations averages 55% total jurisdiction revenue
			Figure 2.3. Net revenue collected as a percent of gross domestic product, 2017
			Figure 2.4. Net revenue collected as a percent of total government revenue, 2016
			Figure 2.5. Average net revenue collections (in percent) by major revenue type, 2017
			2.3.3. Withholding at source
			Table 2.2. Withholding regimes for income of residents, 2017
	Chapter 3. Performance of tax administration
		3.1. Introduction
			Figure 3.1. Overview of core tax administration functions
		3.2. Registration, identification and authentication
			3.2.1. Levels of registration
			Figure 3.2. Registration of active personal income taxpayers as percentage of citizen population, 2017
			3.2.2. Joined-up processes across government
			Box 3.1. Registration and identification
			3.2.3. Identity management
			Box 3.2. Security, authentication and identity protection
			3.2.4. Identity across borders
			Box 3.3. Common Reporting Standard
		3.3. Assessment
			Box 3.4. Automatic tax assessments
			3.3.1. Use of e-channels for filing and paying
			Table 3.1. Average e-filing rates (in percent)
			Table 3.2. Evolution of e-filing between 2014 and 2017
			Table 3.3. Average e-payment rates (in percent)
			Box 3.5. New approaches for payments
			3.3.2. Pre-filled returns
			Box 3.6. Pre-filling
			Figure 3.3. Categories of third party information used in pre-filled returns, 2017
			3.3.3. On-time return filing
			Table 3.4. Average on-time filing rates (in percent) by tax type
			Figure 3.4. Range in on-time filing performance, 2017
			Figure 3.5. PIT and CIT on-time filing rates, 2017
			3.3.4. On-time payment
			Table 3.5. Average on-time payment rates (in percent) by tax type
			Table 3.6. Evolution of on-time payment rates (in percent) between 2014 and 2017
			Figure 3.6. Range in on-time payment performance, 2017
			Box 3.7. Paying taxes
		3.4. Verification
			3.4.1. Case selection
			Figure 3.7. Most common verification case selection criteria, 2017
			3.4.2. Information and access powers
			Figure 3.8. Information and access powers, 2017
			3.4.3. Coverage and results
			Table 3.7. Evolution of the average verification adjustment rate by audit type (in percent) between 2014 and 2017
			Figure 3.9. Assessments raised and collections from audits
			Figure 3.10. PIT audit coverage, 2017
			Figure 3.11. CIT audit coverage, 2017
			3.4.4. Tax crime investigations
			Table 3.8. Management arrangements for criminal tax investigations, 2017
			Box 3.8. Criminal tax investigations
			Table 3.9. Summary of criminal tax investigation work
			Box 3.9. OECD responses to tax crime
		3.5. Collection
			3.5.1. Collecting outstanding returns
			Table 3.10. Outstanding return collection, 2017
			3.5.2. Collecting outstanding debt
			3.5.3. Performance in collecting outstanding debt
			Figure 3.12. Total year-end tax arrears as a percent of total net revenue, 2017
			Figure 3.13. Total year-end collectible arrears as percentage of total year-end arrears, 2017
			Figure 3.14. Movement in tax arrears cases between 2016 year-beginning and 2017 year-end
			Figure 3.15. Range of arrears older than 12 months in relation to total arrears by tax type, 2017
			3.5.4. Collection powers and their usage
			Figure 3.16. Powers to assist managing debt, 2017
			Figure 3.17. Powers to assist collection, 2017
			Figure 3.18. Powers to assist enforcement of debt, 2017
			Box 3.10. Publication of names of large debtors
			3.5.5. Preventive approaches
			Box 3.11. Preventive approaches
			3.5.6. Cross-border collection
			Box 3.12. Locating overseas based student loan borrowers
		3.6. Disputes
			Box 3.13. Improving timeliness in processing taxpayer objections
			Table 3.11. Dispute resolution review procedures, 2017
			Figure 3.19. Changes in the number of cases under internal review procedures between 2016 year-beginning and 2017 year-end
			Figure 3.20. Changes in the number of cases under independent review by external bodies between 2016 year-beginning and 2017 year-end
			Figure 3.21. Number of internal review cases initiated per 1 000 active PIT and CIT taxpayers, 2017
			Figure 3.22. Percentage of cases resolved in favour of the tax administration
			Box 3.14. Dispute Feedback Loop initiative
		References
	Chapter 4. Administrative, operational and organisational practices
		4.1. Introduction
		4.2. Governance arrangements for tax administrations
			4.2.1. Institutional arrangements
			Figure 4.1. Institutional frameworks, 2017
			4.2.2. Autonomy of operations
			Table 4.1. Authority delegated to tax administrations, 2017
			Box 4.1. An “operational autonomy index”
			Figure 4.2. Operational autonomy index, 2017
			4.2.3. Governance structures
			Table 4.2. Taxpayer’s rights and obligations
			Box 4.2. Managing taxpayer complaints
			Figure 4.3. Integrity strategy, 2017
			Box 4.3. United States – Risk Acceptance Form and Tool
			Box 4.4. The “public accountability index”
			Figure 4.4. Public Accountability Index, 2017
			4.2.4. Policy advice
		4.3. Budget and information and communication technology
			4.3.1. Operating and capital expenditures
			Figure 4.5. Salary cost as a percent of total operating budget, 2017
			Box 4.5. Finding cost reductions
			4.3.2. Cost of collection
			Box 4.6. Difficulties and challenges in using the “cost of collection” ratio as an indicator of efficiency and/or effectiveness
			Figure 4.6. Movement in “cost of collection” ratios between 2016 and 2017
			4.3.3. Information and communication technology
			Figure 4.7. Development of primary ICT solutions, 2015
			Figure 4.8. ICT from external/both: Product type, 2017
			Box 4.7. Improving IT security
			4.3.4. Outsourcing
			Figure 4.9. Most common administrative functions/operations that are predominantly outsourced, 2017
		4.4. Workforce
			Figure 4.10. Double pressure on workforce
			Box 4.8. Supporting staff
			4.4.1. Staff usage by function
			Figure 4.11. Staff usage by function, 2017
			4.4.2. Staff metrics
			Figure 4.12. Age profiles of tax administration staff, 2017
			Figure 4.13. Evolution of percentage of staff older than 54 years between 2014 and 2017
			Figure 4.14. Average length of service vs. average age profile, 2017
			Box 4.9. Knowledge management
			Figure 4.15. Percentage of female staff – total female staff vs. female executives, 2017
			Table 4.3. Percentage of female staff (in percent) between 2014 and 2017
			Box 4.10. The OECD’s Forum on Tax Administration Gender Balance Network
			Figure 4.16. Attrition and hire rates, 2017
			4.4.3. Human resource management
			Table 4.4. Human resource management approaches, 2017
			Box 4.11. Human resource management
			Figure 4.17. The E-Personnel Framework
			4.4.4. Human resource autonomy
			Table 4.5. Human resource autonomy, 2017
			4.4.5. Staff satisfaction and performance management
			Table 4.6. Staff satisfaction and performance management, 2017
			Box 4.12. Performance management
			Box 4.13. Improving staff satisfaction
			4.4.6. Remuneration
			Table 4.7. Remuneration, 2015
			4.4.7. Capability
			Box 4.14. Improving staff capability
			Figure 4.18. Number of administrations with specialised positions between 2014 and 2017
			Box 4.15. Specialised skills
		Notes
		References
Part II. Topical issues in tax administration
	Chapter 5. Measuring impacts on the taxpayer’s perception of administrative burdens
		1.1. Introduction
			Figure 5.1. Administrative activities journey
			Table 5.1. Responses to questions on administrative burdens by UK business customers
		1.2. Customer Perceptions of Administrative Burdens
		1.3. Survey to identify international best practice in reducing administrative burdens
			Figure 5.2. International trends in understanding and measuring customer perceptions of burdens from tax policy
			Figure 5.3. Common definitions of tax admin burdens by proportion of survey respondents
			Figure 5.4. Distribution of strategic commitments to reducing admin burdens across survey respondents
		1.4. Qualitative Impacting Methodology
			Figure 5.5. Comparison of quantitative and qualitative admin burden methodology
		1.5. Compliance Burdens Maturity Model
			Figure 5.6. Comparison of current and future support from tax authority across admin burden activity journey
		Note
		Annex 5.A1. The compliance burdens maturity model
			Maturity levels
			How to use the maturity model
			Minimising compliance burdens
		References
	Chapter 6. Educating future taxpayers: Teaching taxes to youth in Canada
		6.1. Educator-led products
			Table 6.1. Learning about taxes
			6.1.1. Teaching Taxes
			6.1.2. Responsible Citizenship and Canada’s Tax System
			Table 6.2. Introducing Canada’s tax system
		6.2. Self-learning product
			Table 6.3. How to do your taxes
		6.3. Online tools and services
		6.4. Social media channels
		6.5. Back-to-school campaign
		6.6. Financial Literacy Month
		6.7. Conclusion
		References
	Chapter 7. Educational initiatives of the National Tax Agency
		7.1. Background
		7.2. Fundamental policy
		7.3. Project structure for promoting tax education
		7.4. Overview of tax education promotional measures
			7.4.1. Dispatching of NTA staff as lecturers to tax education classes
			7.4.2. Development of supplemental text material for tax education
			Table 7.1. Number of tax education classes held
			7.4.3. Essay contests on the subject of tax
			Table 7.2. Number of applicants in the tax essay contest
			7.4.4. The knowledge-enhancing activities for educators
		7.5. Conclusion
		Notes
		Reference
	Chapter 8. Strategies for understanding, engaging and partnering taxpayers to create a socially responsible taxpaying community
		8.1. Developing an accurate and holistic understanding of taxpayers
			8.1.1. Design
			Box 8.1. IRAS revamped its myTax Portal to improve taxpayers’ online experience
			8.1.2. Analytics
			Box 8.2. Text mining to analyse taxpayers’ email enquiries
		8.2. Engaging taxpayers in the right way and at the right time
			Box 8.3. The service mantra of IRAS
			8.2.1. Digitalisation
			Box 8.4. Virtual Assistant “Ask Jamie”
			Box 8.5. Introducing an instantaneous tax assessment process
			8.2.2. One Public Service
			Box 8.6. One Public Service
		8.3. Engaging taxpayers as partners
			8.3.1. Co-creation opportunities
			Box 8.7. Application Programming Interface Marketplace
			8.3.2. Taxpayer representative bodies
			Box 8.8. The Taxpayer Feedback Panel
		8.4. Monitoring and making continuous improvements
			Box 8.9. Focus group discussions and surveys
		Note
		Reference
	Chapter 9. “Virtual Assistant” for VAT
		9.1. Background
		9.2. Cooperative relationship between the Spanish Tax Agency and a multinational supplier
		9.3. How does the Virtual Assistant work?
			Figure 9.1. Stages of the creation process of the virtual assistant for VAT
		9.4. Problems faced and solutions.
			Figure 9.2. Extract of a decision tree
			9.4.1. Duration of the design and training stage: launching in blocks
			9.4.2. Expectations of the taxpayer: welcome message
			9.4.3. Negative rating: audit of the conversations
			9.4.4. Complex questions: supplementary tools and response from a technician
			9.4.5. Maintenance and updating of the Assistant: Documentation
		9.5. Results obtained and future prospects
			Figure 9.3. Comparative Virtual Assistant and mailbox SII
		9.6. Conclusion
	Chapter 10. Behavioural insights for tax administration
		10.1. What is behavioural insights?
		10.2. Behavioural insights applied to tax administration
			Box 10.1. Increasing foreign income reporting
			Box 10.2. Moving taxpayers online and testing uplift modelling
			Figure 10.1. Uplift model framework
			Box 10.3. Encouraging tax payments through outbound calls
			Figure 10.2. Combining the use of predictive analytics, uplift modelling and BI interventions
			Box 10.4. Enhancing empathy and communication toward cooperative audits
		10.3. Building capabilities for behavioural insights
			Box 10.5. ATO Behavioural Insights Unit
		10.4. Future directions and opportunities
		Notes
		References
	Chapter 11. A blockchain scenario study
		11.1. Introduction
		11.2. Blockchains and distributed ledger technology
		11.3. The scenario narratives
			11.3.1. Scenario A. Dual Reality
			11.3.2. Scenario B: Blocktopia
			11.3.3. Scenario C: Govchain
			11.3.4. Scenario D: Beyond the hype
		11.4. Discussion and application
		Notes
		References
	Chapter 12. Compliance by design: Automatic profit tax return for freelancers – A pilot of the Netherlands Tax and Customs Ad
		12.1. Introduction
		12.2. A growing and diverse group of freelancers
		12.3. Compliance by design: A smart accounting programme
			Figure 12.1. Compliance by design: a smart accounting programme
		12.4. Compliance by design: Interaction with the NTCA
		12.5. Compliance by design: The automatic profit tax return
		12.6. Promising results
		12.7. Method
		12.8. Collaboration with freelancers
		12.9. Collaboration with prominent software suppliers
		12.10. Collaboration with other parties
		12.11. What are the follow-up steps?
	Chapter 13. Innovations in dispute resolution
		13.1. Introduction
			Table 13.1. ATO dispute resolution trend figures and statistics
		13.2. Independent Review
			Table 13.2. Independent Review for Large Market taxpayers
		13.3. Dispute Assist
			Box 13.1. Example of the use of Dispute Assist
		13.4. In-house facilitation
			Table 13.3. In-house facilitation referrers
			Box 13.2. Example of in-house facilitation
		13.5. Settlements
		13.6. Measuring fairness
		13.7. Conclusion
		Notes
		References
	Chapter 14. Improving the ATO staff experience: Increasing productivity and engagement
		14.1. Becoming an employer of choice
		14.2. Working towards 2024
		14.3. Improving the staff experience
			Table 14.1. Framework of nine staff experience “pillars”/“lenses”
		14.4. Recruitment
			Box 14.1. The Opening Door programme
		14.5. Learning and development
			Box 14.2. The virtual career expo
			Box 14.3. Technical conference to support the development of tax law capability in the ATO
		14.6. Right tools and physical workspace
			Box 14.4. Mobile phone application
		14.7. Leadership and culture
			Table 14.2. Five cultural traits
			Box 14.5. The staff exploration day and fix-it squad initiative
		14.8. Productivity and engagement benefits
			Figure 14.1. Average unplanned leave days – Rolling 12 months
			Figure 14.2. Longitudinal comparison of APS Employee Engagement Model
		Note
		References
Annexes
	Annex A. Data tables
	Annex B. Participating tax administrations
		Table B.1. Overview of tax administrations included in this report