KRA strategies is transforming tax administration
By People Daily, July 19, 2021Mohamed Omar
The recently launched 8th Corporate Plan by KRA crystalises the direction of the authority by outlining a host of strategies and approaches that either give a new impetus to the current efforts to strengthen the tax system or introduce new strategies to boost the transformation journey.
What are the key planks in the effort to achieve continuous improvement of the tax system and how might these by realised?
First, enhanced services to the taxpayers is a key consideration that can be looked at from a number dimensions.
The refinement of i-Tax and other systems will continue with a view to facilitating compliance with the tax statutes.
Beyond that, the application of cutting-edge technologies such as Machine Learning, Artificial Intelligence and Bloch Chain is expected to have significant impact in further deepening the tax administration’s analytics capabilities.
We have seen how tax administration efforts are boosted by data and evidence when undertaking the compliance efforts.
These technologies are bound to entrench that even further by making sense of data from internal and external systems.
This guarantees the underpinning clarity and precision in any intervention.
For the taxpayer, these will lead to the availability of focused and targeted services, where services are tailored to the needs of specific clusters of taxpayers thanks to the power of data analytics.
To complement the application of technology is the expansion of the physical presence in different regions.
The multi-channel – physical and digital- approach to enhance the availability of human and technological support mechanisms is based on the realisation that not everybody is adept at using or having access to modern technology.
Second, policy and administrative simplification is a key anchor in the transformation of any tax system.
A simplified tax system is a key parameter in compliance improvement, competitiveness, expansion of the tax base and the attractiveness of the country as a preferred investment destination.
The administrative strategies in this respect revolve around streamlining the processes, systems and the procedures employed, so that it is easier and cheaper to comply.
The idea is to smoothen processes such as exports, imports tax filing and payments.
On the other hand, the strategic intent to simplify the regulatory and policy is about re-looking at the tax statutes for any complexities, a process spearheaded by the National Treasury.
Germane to the concept of simplification are the proposed National Tax Policy and the Medium-Term Strategy.
The National Tax Policy is meant to be the overall framework that imbues fairness and predictability into the tax system.
The Medium-Term Revenue Strategy under consideration introduces a slightly longer planning horizon for revenue mobilisation measures, thereby also injecting predictability into the system.
Third, a tax system is in a mutually reinforcing ecosystem comprising private sector, multilateral agencies, government entities, counties and taxpayers.
As a result, forging strategic partnerships becomes an imperative, making it a key thrust in tax reforms.
The development of taxation strategies, regulations, and guidelines require the input of the relevant stakeholders.
Fourth, a key element in achieving a transformed tax administration is the work ethos, culture and the organisational values.
What matters is not necessarily the espoused values, but lived values and actions that are reflected in the service that is provided, staff productivity, and level of integrity.
Specific measures include a combination of performance frameworks, training and integrity programmes that offer a supportive environment while at the same time emphasising accountability. — The wrtier is the KRA Commissioner – Strategy, Innovation and Risk Management