Tax Administration 2022 report: Main conclusions – Part 2

Comes from

  1. TAs’ RESOURCES

Budget constraints continue to affect the TAs. While most of them report an increase in operating expenses in absolute terms, this may not show the full picture, as they face increased responsibilities, the pressures of technological change and the changing structure of their workforce.

There is also a significant variation in the amount of operating and capital expenditures on information and communication technology.

Technology is helping TAs respond to these budgetary challenges, and an emerging trend that is showing remarkable results is the increasing use of Robotic Process Automation (RPA), where machines are used to complete repetitive tasks.

The examples provided in the report have highlighted that RPA is not only significantly increasing operational efficiency, but the personnel satisfaction is increasing, as they can concentrate on the most interesting and challenging tasks.

One of the biggest changes caused by the pandemic was the growth of remote work, and TAs are now considering how to adjust their work practices to take advantage of the benefits that more flexible working modalities can offer.

 

  1. INTERNATIONAL COOPERATION.

The report is part of the knowledge-sharing programme at the OECD Forum on Tax Administration (FTA), which is helping TAs to learn from each other.

Practical tools such as the OECD FTA maturity model on digital transformation[1] are helping jurisdictions identify their strengths and weaknesses, which in turn provides a greater focus for collaboration.

International cooperation has also helped to support the national trend towards the sophisticated use of data, by providing access to datasets provided by initiatives such as country-by-country reports, information exchange and the OECD/G20 CRS.

These have provided large volumes of data on cross-border activities to the TAs, which is adding a new dimension to existing national activities, including risk assessment processes.

TAs have also gained significant experience of working together to effectively implement complex international initiatives such as the OECD/G20 BEPS action plan and the OECD International Compliance Assurance Programme, where taxpayers and TAs work cooperatively and multilaterally in near-real conditions,  and they conduct risk assessment and assurance of major international tax risks.

As TAs go through their own digital transformation processes, the next challenge will be to determine how this national learning can be applied across borders, hot to use new technology to support real-time cross-border information exchange, and provide smoother results for taxpayers, by granting tax certainty[2].

 

  1. FINAL THOUGHTS.

I find the reports that the FTA has been preparing since 2004 regarding TAs especially useful, since they not only reflect the trends of the topics but also have countless cases of practical application.

This is the first report where, based on the year 2020, the trends and consequences of the COVID 19 pandemic are glimpsed.

It is clear that we are witnessing a historic moment in terms of digital transformation, not only of the TAs, but of society as a whole.

I am convinced that the pandemic accelerated these processes and, in many cases, demonstrated their efficiency and effectiveness, allowing to provide services and even provide other functions, in addition to the traditional collection at those times of closure of the TAs’ offices.

Of course, in other cases it has exposed the deficiencies of countries in issues such as digital connectivity, digital literacy, excluded groups, etc., which requires urgent attention.

I believe that today this digital transformation is no longer an option but a necessity.

The trends reflected in the 2020 report, in terms of more personalized services with digital contacts, increasing use of new ICTs (AI, Big Data, Blockchain, etc.), new ways of working, increasing use of information exchanges, as well as the gradual advance towards compliance models by design, among others, will also be enhanced in subsequent reports.

In my view, this digital transformation of the TAs and governments in general should drive further collaboration in the simplification of tax systems, the rules, the procedures and services, by placing citizens at the center of this process.

In short, the path is not easy, but it promises great results. There are different realities in each country, but the important thing is to know where we want to get to in order to take the first step, and in this sense, reports such as the one analyzed here provide broad guidance on many of these issues.

[1] OECD (2021), Digital Transformation Maturity Model, OECD, Paris, https://www.oecd.org/tax/forum-on-tax-administration/publications-and-products/digital-transformation-maturity-model.htm
[2] OECD (2021), Statement on a Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy, OECD/G20 Base Erosion and Profit Shifting Project, 8 October 2021, https://www.oecd.org/tax/beps/statement-on-a-two-pillar-solution-to-address-the-tax-challenges-arising-from-the-digitalisation-of-the-economy-october-2021.pdf

Disclaimer. Readers are informed that the views, thoughts, and opinions expressed in the text belong solely to the author, and not necessarily to the author's employer, organization, committee or other group the author might be associated with, nor to the Executive Secretariat of CIAT. The author is also responsible for the precision and accuracy of data and sources.

Leave a Reply

Your email address will not be published.

CIAT Subscriptions

Browse through the site without restrictions. Consult and download the contents.

Subscribe to our electronic newsletters:

  • Blog
  • Academic offer (Only in spanish)
  • Newsletter
  • Publications
  • News alert

Activate subscription

CIAT Members

Representatives, Correspondent and Authorized staff (TA)