The Impact of Information Technology on Tax Administration : a Systematic Review

The Impact of Information Technology on Tax Administration : a Systematic Review
Author: Joyce Kgonare
Publisher:
Total Pages:
Release: 2018
Genre:
ISBN:

Background: Information Communication Technology (ICT) continues to play a significant role in transforming the administration of tax. It improves interaction between government and its citizens, transactional and informational. A number of studies have focused on ICT and tax administration, however, the full extent of its impact from these studies remains relatively unknown. This study reviews the literature on tax administration and ICT in order to acquire a structured view of its impact. Main purpose of study: To perform a systematic literature review of published articles to comprehend the impact of ICT on tax administration. This study provides a structured overview of the academic journal publications on ICT and tax administration. Method: This study adopts a systematic literature review approach. Academic articles published between 2007 and 2017 are reviewed to assess the impact of ICT on tax administration. These academic articles were sourced from renowned databases, namely: Scopus, Web of Science and Proquest. Only highly rated ABDC journal articles were analysed for the purpose of this study. Results: A total of 18 academic journals were sourced which specifically discuss ICT and tax administration. The study revealed that ICT positively impacts on tax administration. It creates an enabling environment for effective and efficient tax administration through simplification and continued audits through improved techniques and tools. Furthermore, taxpayeraÌ22́Ơ4́Øs perceptions improved as a result of reduced administration costs and increased voluntary compliance, improved governments decision-making strategies through increased revenue collection, tax planning and performance management. Moreover, it improves exchange information between governments through ICT information sharing techniques. Conclusions: The study revealed that ICT affects tax administration as follows: tax simplification, an audit tool, decision-making tool, impacts user perceptions and fairness towards compliance, and an information sharing tool with other tax agencies. However, it is recommended that additional studies should be undertaken from the policy perspective. The scope of this research article can be expanded to include articles published in journals other than the ABDC list and alterative years to that covered in this study.

Use of Technology in Tax Administrations 1

Use of Technology in Tax Administrations 1
Author: Ms.Margaret Cotton
Publisher: International Monetary Fund
Total Pages: 18
Release: 2017-03-14
Genre: Business & Economics
ISBN: 1475583605

This technical note is the first of three addressing information technology (IT) themes and issues relevant to tax administrations. This note focuses on the use of technology in tax administrations and how to develop an information technology strategic plan (ITSP). It is intended for tax administrations that are largely manual or have outdated legacy IT systems. The second note addresses how to select an IT system for core tax administrations functions. And the third note covers implementation of a commercial-off-the-shelf (COTS) system. These technical notes are primarily for use by tax administrations that have no technology to manage their core tax processes, or their technology is limited and outdated. These notes focus on core tax functions and do not address other business systems (e.g., payroll, finance, document, and asset management systems).

Exploring the Adoption of Selected Digital Technologies in Tax Administration

Exploring the Adoption of Selected Digital Technologies in Tax Administration
Author: Manabu Nose
Publisher: International Monetary Fund
Total Pages: 19
Release: 2023-12-11
Genre: Business & Economics
ISBN:

Using cross-country data, this note explores the potential impact of selected digital technologies on tax collection and compliance. The analysis makes use of multi-dimensional International Survey on Revenue Administration, Tax Administration Diagnostic Assessment Tool, and Revenue Administration-Gap Analysis Program (RA-GAP) data with results indicating that digital technologies could help enhance tax collection, but with effects that vary by the type of specific digital service or tools introduced. While the results demonstrate a strong association between digital tax administration operations and improved performance outcomes, the realization of revenue gains is heavily contingent on accompanying policy, legislative, and administrative reforms, as well as the availability of adequate digital connectivity and capable tax administration staff. The cross-country approach provides reasonable upper-bound estimates on revenue gains, which, however, need to be carefully validated with country-specific case studies. The note reviews single country case studies from selected micro-economic literature that complement the cross-country results and reveal key enabling factors necessary to reap and sustain the benefits of new digital investments.

Digitalization to Improve Tax Compliance: Evidence from VAT e-Invoicing in Peru

Digitalization to Improve Tax Compliance: Evidence from VAT e-Invoicing in Peru
Author: Mr.Matthieu Bellon
Publisher: International Monetary Fund
Total Pages: 36
Release: 2019-11-01
Genre: Business & Economics
ISBN: 1513513710

This paper examines the impact of e-invoicing on firm tax compliance and performance using administrative tax data and quasi-experimental variation in the rollout of VAT electronic invoicing in Peru. We find that e-invoicing increases reported firm sales, purchases and value-added by over 5 percent in the first year after adoption. The impact is concentrated among smaller firms and sectors with higher rates of non-compliance, suggesting that e-invoicing enhances compliance by lowering compliance costs and strengthening deterrence. The reform’s positive effects on tax collection are hindered by shortcomings in the VAT refund mechanism in Peru, suggesting that digital tools such as e-invoicing should be complemented by other reforms to improve revenue mobilization.

Use of Technology in Tax Administrations 2

Use of Technology in Tax Administrations 2
Author: Ms.Margaret Cotton
Publisher: International Monetary Fund
Total Pages: 17
Release: 2017-03-14
Genre: Business & Economics
ISBN: 1475581122

This technical note is the second of three addressing information technology (IT) themes and issues relevant to tax administrations. This note addresses how to select a suitable IT system for core tax administration functions. Note one covers the use of IT in tax administrations and how to develop an information technology strategic plan (ITSP). The third note focuses on implementation of a commercial-off-the-shelf (COTS) system. These technical notes are primarily for tax administrations that have no technology to manage their core tax processes, or their technology is limited and outdated. These notes focus on core tax functions and do not address other business systems (e.g., payroll, finance, document, and asset management systems).

Improving Tax Collection Efficiency Through the Use of Technology

Improving Tax Collection Efficiency Through the Use of Technology
Author: Mokube Mathias itoe
Publisher:
Total Pages: 0
Release: 2023
Genre:
ISBN:

Governments in African countries rely heavily on tax revenue to finance their development projects and public services. However, tax collection in many African countries is plagued by inefficiencies, low compliance, and inadequate revenue mobilization. The World Bank estimates that sub-Saharan Africa has one of the lowest tax-to-GDP ratios in the world, with an average rate of 17.2%, compared to the global average of 23.1%.Tax collection in Africa is hindered by a number of factors, including weak tax administration, low levels of tax compliance, and limited access to technology. The lack of advanced technology and automation in tax administration has resulted in manual and paper-based systems that are inefficient, costly, and prone to corruption. This has made tax collection and compliance difficult, and has limited the amount of revenue that governments can generate from taxes.To overcome these challenges, African governments are increasingly turning to technology as a means of improving tax collection efficiency and increasing revenue mobilization. Technology adoption in tax administration has the potential to improve tax compliance, reduce the costs of tax collection, and increase revenue collection. The adoption of technology can also improve transparency, accountability, and reduce the potential for corruption in tax administration.This article explores the use of technology in tax collection in African countries, with a focus on its impact on tax collection efficiency. Specifically, the article examines case studies from Rwanda and Kenya, two African countries that have made significant progress in using technology to improve tax collection efficiency.The article begins with a literature review that discusses the challenges facing tax collection in African countries, the benefits of technology adoption in tax administration, and the factors that influence tax collection efficiency. The literature review also examines the existing literature on the adoption of technology in developing countries and the lessons that can be learned from these experiences.Next, the article describes the research design and methodology, including the case studies used in the research and the data collection methods. The case studies focuses on the use of technology in tax collection and administration in Rwanda and Kenya, and the impact of technology adoption on tax collection efficiency in these countries.The results of the research are presented and analyzed, including an examination of the impact of technology adoption on tax collection efficiency in Rwanda and Kenya. The article discussed the factors that facilitated or hindered technology adoption in these countries, and the lessons that can be learned from their experiences.The article provides a detailed case study of the tax system and technology adoption in Rwanda and Kenya. The case study examined the current state of tax collection in these countries, the technologies used to improve tax collection, and the impact of these technologies on tax collection efficiency.Finally, the article concludes by summarizing the main findings of the research and discussed the implications of the results for tax policy in African countries. The article suggests areas for future research on the adoption of technology in tax collection and administration in African countries.Overall, the article contributes to the existing literature on tax collection efficiency and technology adoption in developing countries. It provides insights into the challenges facing African countries in tax collection and administration, and the potential of technology adoption to overcome these challenges and improve tax collection efficiency.

Improving Tax Administration in Developing Countries

Improving Tax Administration in Developing Countries
Author: Richard Miller Bird
Publisher: International Monetary Fund
Total Pages: 430
Release: 1992-09-15
Genre: Business & Economics
ISBN:

"Taxation, like politics, is the art of the possible -- yet most public finance texts ignore the critical role played by tax administration in restoring macroeconomic balance and promoting equity and efficiency. This volume fills a gap in the literature by linking tax policy and tax administration reform and exploring ways to improve taxpayer compliance. The papers included in the volume were prepared for a symposium sponsored by the Instituto de Estudios Fiscales of the Ministry of Finance of Spain. The editors are authorities on tax policy and administration and have published extensively on tax issues."--P. [4] of cover.

Risk-Based Tax Audits

Risk-Based Tax Audits
Author: Munawer Sultan Khwaja
Publisher: World Bank Publications
Total Pages: 157
Release: 2011-06-08
Genre: Business & Economics
ISBN: 0821387545

"Revenue administration is a major interface between the state and its citizens. A good revenue administration is, therefore, an important attribute of good government. As a result, in recent years, policy makers have become increasingly aware of the importance of policies that will promote business development while ensuring voluntary tax compliance. In the modern context, it is neither desirable nor feasible to examine or inspect every single taxpayer. The revenue administration, therefore, has to rely on effective management of compliance. Promoting voluntary compliance, achieved through a self-assessment system in which taxpayers comply with their tax obligations without intervention from tax officials, requires developing modern approaches to audits based on risk management. The impact of audits critically depends on a properly designed audit selection strategy focused on high-risk taxpayers to provide the most cost-effective outcome. This, in itself, contributes to promoting voluntary compliance. Risk-based country audits: approaches and country experiences are an important study of this critical revenue function of compliance management."--Publisher's website.

Tax Administration and Firm Performance

Tax Administration and Firm Performance
Author: Ms.Era Dabla-Norris
Publisher: International Monetary Fund
Total Pages: 40
Release: 2017-04-14
Genre: Business & Economics
ISBN: 1475595166

Tax compliance costs tend to be disproportionately higher for small and young businesses. This paper examines how the quality of tax administration affects firm performance for a large sample of firms in emerging market and developing economies. We construct a novel, internationally comparable, and multidimensional index of tax administration quality (the TAQI) using information from the Tax Administration Diagnostic Assessment Tool. We show that better tax administration attenuates the productivity gap of small and young firms relative to larger and older firms, a result that is robust to controlling for other aspects of tax policy and of economic governance, alternative definitions of small and young firms, and measures of the quality of tax administration. From a policy perspective, we provide evidence that countries can reap growth and productivity dividends from improvements in tax administration that lower compliance costs faced by firms.