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What should the government do when there are signs of corruption within and around the tax administration? Show zero tolerance for corruption, identify, and punish both tax authority employees and taxpayers who engage in criminal activities with them. However, the forbidden fruit is so tempting that corruption cannot be stopped solely through such methods. Other approaches can help.
Tax administration promotes taxpayer compliance as well as effective and equitable revenue collection. Tax administration costs are the expenses incurred by taxpayers in order to comply with tax laws. Time and resources spent on record keeping, tax preparation, and tax risk management can all be included in these expenditures. In this article, we will look at the many forms of taxpayer costs associated with tax administration, as well as the factors that contribute to these costs. We will also examine techniques that tax authorities can employ to reduce taxpayer losses. Knowing taxpayers' costs of tax compliance can assist improve the efficacy of tax policy and reduce taxpayers' unproductive spending.
Previously, we spoke about the specific organizational culture of the tax authorities and the urgent need to change it to improve the efficiency of tax administration. It is difficult to change something that has developed over decades, exists steadily at the expense of state funding, has gained internal and external relations, and is not willing to change. Let us take a closer look at the underlying factors that motivate a tax administration to alter its set of standards and values.
Despite the obvious differences in the culture and lifestyle of different states, the corporate culture of tax authorities has common features. As once said by a Tax Administration Head: “Why do tax officials love themselves and their service so much? Because no one else loves them". It is impossible to implement successful digital tax transformation projects without changing the corporate culture of tax authorities. Automation of illogical contradictory provisions of the tax code and current processes will bring even more confusion and mothball all modernization efforts. To start automation, it is required to modernize the corporate culture at first and inspire other values and attitudes in tax officials.
Digital Tax