COVID-19 accelerated the digital transformation of tax administrations

​Tax Administration 2022, the tenth edition in the series, provides internationally comparative data on aspects of tax systems and their administration and includes a variety of examples to highlight recent innovations and good practices. It aims to assist administrations, governments, taxpayers and other stakeholders in considering how and where improvements can be made in the efficiency and effectiveness of tax administration.

For the first time, this edition also uses data from the recently launched Inventory of Tax Technology Initiatives which contains information on technology tools and digitalisation solutions implemented by more than 75 tax administrations.​

Practice

OCDE (2022), Tax Administration 2022 : Comparative Information on OECD and other Advanced and Emerging Economies, Éditions OCDE, Paris, https://doi.org/10.1787/1e797131-en.​

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In a few words

Tax administrations continued to deliver quality services for taxpayers during the COVID-19 pandemic, including in many cases delivering wider government support measures, while collecting EUR 12.1 trillion in 2020, according to new data from 58 OECD and other advanced and emerging economies.

Tax Administration 2022 shows how the pandemic accelerated the shift to digital services with a 30% increase in digital contacts in 2020. Digital channels are now dominating interactions with taxpayers, with around 1.3 billion contacts via online taxpayer accounts, and more than 30 million contacts via chatbots. This is a rapid shift from the pre-pandemic models which may have depended on channels such as post or in-person visits to the tax office. These new channels are often employing behavioural insights which are becoming more widely used in all aspects of a tax administration’s work.

The report, together with the many examples provided by tax administrations, highlights the continuing digital transformation underway with tax administrations globally aimed at automating tax compliance in more areas and further reducing burdens for hundreds of millions of taxpayers. The report also identifies how tax administrations have further adapted their operating models for a post-pandemic workplace. This is seeing many tax administrations adapt HR practices developed around office working to take account of a more extensive hybrid working model, helping to provide greater flexibility to their workforce whilst continuing to provide high-quality services to taxpayers.

Commenting on the report, Bob Hamilton, Chair of the OECD Forum on Tax Administration (FTA) and Commissioner of the Canada Revenue Agency said, “This edition of the Tax Administration Series highlights the range of innovations being undertaken by tax administrations both in their interactions with taxpayers and in their internal operations, including as a result of lessons learnt from the COVID-19 crisis. Leading a tax administration myself, it is clear to me that digital service delivery, as well as increased agility and flexibility, is going to be of central importance to us in achieving our goals while meeting the expectations of taxpayers in the rapidly digitalising economy.”

The report also highlights how digital transformation is being driven by the manipulation and management of data, which is central across a tax administration's functions. For example, around 90% of tax administrations report using data science and analytical tools to facilitate the use of data in all aspects of their work.

“One of the big challenges for tax administrations going forward is how to exploit the opportunities that artificial intelligence and machine learning bring so that they can use cutting-edge techniques to further improve services to taxpayers,” said Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration.

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Source : OCDE, June 2022