Index
A
Aadhaar, in India, 259, 287–89, 290n24
Absenteeism reduction, 317
Adoption, 7
blockchain relating to, 187–88, 190–93
digital coverage and, 207, 207nn10–11
with mobile phone, 207
Agriculture, 201, 210–11, 211f, 214–15, 214n19
Airbnb, 70, 71f, 75f, 80, 174
Amazon, 174
Andhra Pradesh, India, 289, 310
Anti-poverty programs, 230–31
AS theorem. See Atkinson-Stiglitz theorem Atkinson-Stiglitz (AS) theorem, 35–37, 38, 40
Audit rates, with pre-population
experiments, 122–23
Automated jobs, digitalization with, 11
Average earning ability, 45
B
Banking, in India, 259–60, 260n4
credit impact of, 271, 272f
Barter, with digitalization, 108–10
BASE, 120, 121f, 122f
Base Erosion and profit Sharing (BEPS) project, 92, 109, 123
Action Plan of, 98
concerns with, 97–98, 97n5
focus of, 96–97, 96n4
profit shifting with, 14, 97–99, 104
proposals of, 97
tax competition with, 40, 98–99, 104
Behavior, of compliance, 127
Behavioral implications, of digital tax administration, 113
Benefit coverage expansion, 5
Benefits, of digitalized government payments
absenteeism reduction, 317
broader use, 316, 318–19
digital trail, 319
financial inclusion, 318
government service delivery improvement, 316, 317–18
poorer household focus, 317
productivity boost, 319–20
subsidy reduction, 318
tax enforcement, 316, 319–20
Benefits, of digital technologies
better service with, 210
cost reduction with, 208–9
with digital data collection, 209
from digital revolution, 13, 20
with mobile money, 209
for mobile phones, 208, 208n13
new service providers, 209
in remote rural areas, 208, 208n12
BEPS. See Base Erosion and profit Sharing project
Better Tan Cash Alliance, 279–80, 280n1, 280nn4–5
Blockchain
adoption benefits, 187–88
benefits of, 179–81, 181t
Cognitive era and blockchain (2011-present), 176
e-Residence, 180
in Estonia, 179–80
growth of, 183
in Kenya, 190–93
for multi-party business interactions, 183
in Nigeria, 190–93
potential benefits of, 179–81, 181t
provenance with, 180
in South Africa, 190–93
technology with, 10, 11, 12, 16
transactional fraud relating to, 183
workings of, 176–77
See also Digital trust, blockchain and Bond issuance, 186
Bookkeeping, tax administration for, 4
Botswana, 310, 316f
Brazil, daily fiscal data
access and collection of, 154–56, 154t, 157b
applications of, 162–63, 162n10, 163f, 163nn11–12
Brazil, government payments in, 306, 307f, 313
Businesses
multi-party interactions of, 183
Peer-to-Peer, 60, 72–74, 84b–86b, 731nn8–19
self-employed, 67–69, 68f
small, 77
Business-level tax of profit, 103
Business-rule feature, 176–77, 179
C
Capital and labor, treatment of, 75–76, 75nn20–22
Capital gains
of owners, 103
of shareholders, 100, 101
Capital income, 28–29
data on wealth and, 30–31
differing rates for, 42
joint taxation of, 46–47, 47nn25–26
optimal taxation of, 40–45, 41n19, 44n21
positive taxes on, 41
residence basis for, 40
sources of, 42
Synthetic capital income tax, 42, 46n23
Cash
to electronic payments, 279, 306–7
with government payments, 306–7, 306n2, 307f
improvement planning for, 165
reduction of, with PFM, 283
Cash balances, government monitoring of, 163–64
Cash payroll issues, 308
Categorical targeting, for poverty reduction, 229
Central Bank of Kenya, 244, 245b, 247, 256
Central Public Procurement Portal, 263
Central Statistics Office, 270
CFA. See Communaute Financiere Africaine
China, government payments in, 306, 307f, 313, 316f
Civic education, 202, 214
Civic engagement, 210, 211f
Cloud computing, 174, 174n2, 182
Cognitive applications, to public finance, 179–82
Cognitive computing, for revenue collection, 181–82
Cognitive computing systems, 174
cognitive era and blockchain (2011-present), 176
components of, 178
description of, 177
distributed ledgers relating to, 175, 175n3, 176–77
IBM, 178–79, 184–85, 185f
programmable era (1950s-present), 175–76
tabulating era (1900–70), 175
Watson, 178–79
workings of, 176–77
Cognitive era and blockchain (2011-present), 176
Commercial Bank of Africa, 242–43
Commission-based approach, of P2P platforms, 60
Commodities
consumption, 36
demands, 36, 37–39
leisure, 32, 36–37
non-transportable, 38
preferences for, 37
Commodities taxation, 34
differentiation in, 38
digitalization and, 37–39
linear, 38, 38n14
nonlinear, 38, 38n15, 43
optimal income and, 35–37, 38, 44
Communaute Financiere Africaine (CFA), 186
Communications Authority of Kenya, 244, 245b
Complementarity, PFM relating to, 282–84, 283nn11–12
Complementary institutional reform, 8, 12
Compliance, 15
behavior of, 127
with digital tax administration, 113, 115, 115n6
pre-population experiments relating to, 116, 117b, 118–23
rates of, 120–22, 121f, 122f
ratio, 121f
with tax returns, 124
See also Taxpayer guidance, for tax compliance
Computer hackers, 183
Computerization, 1
Consumers
location of, 103–7
as third-party reporters, 32, 51
Consumption
benefits of, 32, 32n7
choices with, 35
data on, 29–30, 29n3, 30n4
individual, 30
value of, 30
Consumption commodities, 36
Consumption tax, 29, 34n10, 136–37, 136n23
progressive, 34–35, 48n27
proportional, 34
Corporate income tax, 31, 31n6
backstop relating to, 39
classical, 40
debt bias relating to, 40
at source, 39, 39nn17–18
source-based taxes, 40
tax arbitrage with, 40
withholding, 39–40
Corporate tax system, international, 15
CORR, 120, 121f, 122f Corruption, in Kenya, 255, 255f
Cost benefit, of PFM, 286, 286n18
Cost reduction assumptions, in African economies
with blockchain adoption, 190–93
with GDP, 190–93, 190n10, 191f, 192f, 193f, 253, 253f
with lower rate of inflation, 190–93
See also Kenya; Nigeria; South Africa
Costs, 50, 78, 153
with digitalized government payments, 310–11
of digital technologies, 182–83
information, 227, 231–32, 231n5
reduction of, 208–9
of revenue data, in Kenya, 254f
transaction, 62–63, 63nn5–6, 114
Côte d’Ivoire, 308
Countries
approach of, to digitalization, 2, 11
of destination, 103, 107
residence, 93
source, 93
See also Developing countries
Country case studies, with digitalization and PFM, 286–95, 287nn19–20, 288t
See also Estonia; Ghana; India; Mexico
Criminals, challenges with, 10
Currency, payments and, 186
Customer-based intangibles, 104–5
Cyberattack, 11
Cyber-criminals, 183
Cybersecurity, 12
D
Daily fiscal data
conclusion to, 169–70
contributions to, 150
IT with, 149
process of, 149
for real-time macroeconomic analysis, 149–50
Daily fiscal data, access and collection of
for Brazil, 154–56, 154t, 157b, 159, 159f, 162–63, 162n10, 163f, 163nn11–12
for Kosovo, 154, 154t, 156, 158, 158f, 159, 159f, 160–61, 161f
for Slovenia, 154, 154t, 156, 159, 159f, 164, 164f, 164n13
for United States, 154, 154t, 156, 159, 159f, 166–68, 167f
VAT revenue case, 155b
Daily fiscal data, applications of, 160n8
cash planning improvement, 165
fiscal surveillance and management, 160–65
government cash balances monitoring, 163–64
government expenditures monitoring, 162–63, 162n10
macro-fiscal analytical work applications, 167–68, 167n16, 168nn17–18
monitoring and forecasting real economic activity, 165–66
tax revenue monitoring and forecasting, 160–61, 160n9, 161f
Daily fiscal data, characteristics of
accuracy, 154
advantages, 153–54
data access and data collected, 154–56, 154t, 155b, 155f
fiscal transparency, 154
processing, smoothing and, 158–59, 159f
relatively low accessibility costs, 153
timeliness, 153
volatility, noise and, 156–58, 158f
Daily fiscal data, generation of
FMIS impact, 150–52, 165
government bank accounts, consolidation of, 152–53, 153n7
TSA impact, 151, 152–53, 153n7, 165
Data, 116, 193–94, 209, 254f
on capital income and wealth, 30–31
consumption of, 29–30, 29n3, 30n4
cross-border linking of, 31
daily fiscal data, 149–50, 169–70
daily fiscal data, generation of, 150–53, 153n7, 165
for digitalized government payments, 314–15
fiscal, 6, 16
P2P platforms as recorders of, 71–72
See also Daily fiscal data, access and collection of; Daily fiscal data, applications of; Daily fiscal data, characteristics of
Dataset linkage, with policy innovation, 135–36
Debt bias, 40
De-duplicated system, in
Ghana, 294, 294n32
De minimus tax, 77
Demonetization, tax collection impact of
long-term, 270–71, 271n10, 272f
short-term, 268–70, 268t, 269f, 269t, 270f
Demonetization decision, in India, 267b, 274
bank credit impact, 271, 272f
consequences of, 267
digitalization impact with, 273, 273f
rank with, 266, 266n9
reasons for, 266
survey relating to, 267
unaccounted income impact with, 271–73
De-risking, 283, 283n14
Design
of fiscal policy, 1
tax, 27, 32–50, 242–44, 250–55
for taxpayer guidance experiments, 124n13, 125–28
See also Tax design, digitalization and
Destination, 109
import taxation with, 106
location, 103, 103nn15–16, 104–5
R&D relating to, 98, 104, 105
in several countries, 103, 107
as source of profit, 104–5
tax based on, 104–6, 106nn17–19
Destination-based cash flow tax, 106, 109
Developing countries
digital technologies in, 201–2
GDP in, 279, 306, 313–14, 319
government payments in, 306, 307f, 313, 315, 316, 316f
Developing economies, 83b, 305–7, 305n1
Digital coverage, adoption and, 207, 207nn10–11
Digital data collection, benefits of, 209
Digital disruption, 174
Digital divide, 261
Digital economy challenges, in India, 265
Digital experimentation engagement, 194
Digital Financial System, in Kenya, 243, 243b, 246, 252, 254, 256–57
Digital Five, 202–3, 203n3
Digital inclusion, challenges with, 7–8
Digital India, 262, 262n5
Digital interventions, for taxpayer compliance, 15
Digitalization, 1, 1n1
with automated jobs, 11
barter with, 108–10
benefits of, 26
better information with, 2–3, 28, 50–52
challenges of, 2
commodity taxation and, 37–39
constraints of, 18
countries approach to, 2, 11
demonetization impacted by, 273, 273f
dual-income-tax system with, 42
electronic, payments with, 281b
future direction of, 298–99
high-level leadership with, 296
impact of, 9
India, consequences of, 259, 261–66, 274–75
integrated, comprehensive approach to, 296–98
international registers linked by, 31
interoperability of, 297, 297n36
optimal commodity taxes and, 38
with policy innovation, 135–36, 135n22
with political economy, norms, institutions, 233
public and private sectors affected by, 27
public finance reshaping with, 2–6
public finances and PFM, 15–16, 19, 279, 295, 298, 299
regulatory requirements for, 297
risks of, 298
single-platform approach, 10
tax policy and, 133
AS theorem relating to, 36–37, 38, 40
See also India, digitalization in; Kenya, digitalization in
Digitalization, for international corporate tax reform
in all sectors of economy, 91
alternate approaches for, 97–107
concerns with, 91–92, 94–95, 97–99
conclusion to, 110–11
consequences of, 94–95
contributions of, 95–96
diverted profits tax, 92
double taxation, 93
effects of, 94–97
equalization levy, 92
example of, 93–94, 94n3
free usage, 108–10
Google Tax, 92
home bias relating to, 96
international corporate tax regime relating to, 93–97
issues for, 107–10
location, of consumers relating to, 103–7
location, of shareholders relating to, 99–103, 99n8
OECD BEPS project, 92, 96–97, 104, 109, 123
with residence countries, 93
with source countries, 93
subsidiaries relating to, 94, 95
two-sided markets, 63n7, 107–8
Digitalized government payments
benefits of, 316–20
cash relating to, 306–7, 306n2, 307f
conclusion to, 320–21
cost savings with, 310–11
data relating to, 314–15
in developing economies, 83b, 305–7, 305n1
fraud reduction with, 310, 311t
GDP relating to, 315–16, 316f
methodology for valuation of, 308–14, 311t
reduction of leakage about, 308–10, 311t, 315
results of, 315–16, 315n5, 317f savings sources for, 309t
for Social Security, 307
value of, 305–7, 306n1, 315–16, 315n5, 316f
Digital monitoring, 212
Digital platform, 14
Digital public service provision, for education, 210–12, 211f
Digital revolution, 2, 8, 10
development of, 11–12, 12n11
implications of, 230–35
potential benefit from, 13, 20
for tax policy and enforcement, 13–14
Digital revolution, implications of, 20
anti-poverty programs, 230–31
information costs, 231–32, 231n5
marginal tax rates, 232
political economy, norms, institutions, 233–35, 233n6
Digital tax administration
advancing of, 114
behavioral implications of, 113
benefits to, 113, 113n1
compliance with, 113, 115, 115n6
conclusion to, 139–40
lower transaction costs with, 114
online, 113–14, 113n4
pre-population, 113, 113n3
taxpayer guidance: popup or paper, 113–15
Digital tax administration, experiments with, 113n1, 113n4
online assistance, 115
on pre-population issues, 115–24, 115n8
Digital technologies
benefits of, 13, 20, 208–10, 208n12, 208n13
Digital technologies, for government
costs and challenges of, 182–83
legal framework for, 183–84
with privacy, 184
with sequencing, 184–85
Digital technologies, for public service provision, 201n1, 231
access and usability of, 202
with agriculture, 201, 210–11, 211f, 214–15, 214n19
with civic education, 202, 214
in developing countries, 201–2
digital coverage and adoption, 207, 207nn10–11
economic development with, 203–6
with education, 202, 212, 212nn217–18
forward with, 218
with health, 202, 210–11, 211f, 215–16
impact of, 202
with mobile phone technology, 2, 17, 201
opportunities for, 218
potential benefits of, 207–10
potential pitfalls for, 216–18
practice and evidence with, 210–16, 210nn14–15, 211f, 211n16
with social protection, 202, 213–14
Digital trails, 9–10, 319
Digital trust
cloud computing and, 174, 174n2, 182
conclusion to, 195–96
cost reduction assumptions, in three African economies, 190–93
friction reduction, 173, 174
industry applications, for other governments, 185–87
introduction to, 173
recommendations, for government, 193–94
with technological advances, 174
transportation and handling expenses, 188–90, 189n9
Digital trust, blockchain and, 173, 173n1
adoption benefits, 187–88
business-rule feature of, 176–77, 179
cognitive applications, to public finance, 179–82
cognitive computing, for revenue collection, 181–82
cognitive computing systems, 174–79, 175n3, 184–85, 185f
digital technologies, for government, 182–85
Direct Benefit Transfer system, 262–63, 266, 274
Distributed ledgers, 175, 175n3, 176–77
Distributional objectives pursuit, 1
Diverted profits tax, 92
Dividends
of owners, 103
of shareholders, 101
Domestic Tax Department, in Kenya, 247
Double taxation, 93
Dual-income-tax system, 41, 42, 43
Dubai Customs, 187
E
Earning ability, 33–34, 36–37, 45, 48
eCFA, 186
Economic case study, in India, 18–19
Economic development, with public service provision
challenge of, 203–5, 203nn4–5
with education, 204
with employment, 205, 205n8
information constraints relating to, 206
with infrastructure, 203, 204, 204n6
limitation of, 204
market failures relating to, 202, 205–6, 206n9
with social protection programs, 204–5, 204n7
studies about, 203
with transportation, 203
Economic experiments, 117b
Economic impact, of P2P activities, 72
Economics
outcomes of, 25–26, 28
welfare, 33
Economic Survey, of 2016–17, 271–72
Economic Survey 2016, 252
Economics, 188, 188n8
developing, 83b, 305–7, 305n1
government stabilization of, 1
in Kenya, 191–93
in Nigeria, 190–93
P2P activities and development of, 83b
in South Africa, 190–93
ECUs. See Experimental currency rates
e-District Mission Mode Project, 265
Education, 214
with digital public service provision, 210–12, 211f
digital technologies for, 202, 212, 212nn17–18
with economic development, 204
e-governance, 262, 264–65, 274
Electronic digitalization, payments with, 281b
Electronic fling, 3
Electronic know-your-customer procedures, 288
Electronic payments
cash to, 279, 306–7
information about, 32
Electronic tracking, tax administration for, 3–4
Electronic transaction systems, 34
Empirical results, of P2P economy, 65–67, 65n10, 67n11
Employees, P2P activities of, 67–69, 68f, 69n13
Employment, with economic development, 205, 205n8
Employment guarantee schemes, 228
Enforcement. See Tax enforcement
e-Panchayat, 265
Equalization levy, 92
Equity-efficiency trade-off, 32, 35, 36
alleviation of, 26–27, 26n1, 34, 34n9
improvement of, 51
e-Residence, 180
Error reduction, with policy innovation, 134
Estonia
blockchain in, 179–80
case study on, 280, 287, 292–93, 293nn29–31, 295
European Commission Expert Group on Taxation of the Digital Economy, 91
Everledger, 180
Expenditure savings, 309t
Experimental currency rates (ECUs), 126
Experiments
with digital tax administration, 113n1, 113n4, 115–24, 115n8
economic, 117b
natural, 119
See also Pre-population experiments; Taxpayer guidance experiments
Externalities, correcting for, 70–71, 71n16, 83b
e-Zwich payment system, in Ghana, 294–95, 295n34, 296
F
Facebook, 108
Fair Price Shop, 289
Finance. See Public finance, reshaping of
Financial Action Task Force, 283
Financial inclusion, 318
Financial institutions, as third-party reporters, 31–32, 51
Financial Intelligence Unit, 264
Financial Management Information Systems (FMIS), 165
general ledger with, 151
government coverage with, 151–52, 152n3
investment level with, 151, 151n2
public accounting systems with, 152, 152n4
reporting with, 152, 152nn5–6
World Bank relating to, 151
Financial services, 210, 211f
Fine targeting, for poverty reduction, 227–28, 229, 232, 233
Fiscal data, 6, 16
Fiscal management innovations, 12, 15–17
Fiscal Monitor, 314
Fiscal policy
design and implementation of, 1
effectiveness of, 1, 2
in India, 259, 261–62
Fiscal surveillance and
management, 160–65
Flat-tax rate, 78
FMIS implementation, 284–86, 284nn15–17, 285b Foreign Account Tax Compliance Act, 102
Form 1099-MISC, 79
Form 1099-OID, 79
Foster-Greer-Torbecke class of poverty indices, 226
Fraud, 5, 8–9, 183, 310, 311t Free usage, with digitalization, 108–10
Fuel subsidies, in India, 290
Fundamental limits, challenges of, 10–11
G
GDP
in developing countries, 279, 306, 313–14, 319
digitalizing government payments relating to, 315–16, 316f
in India, 266, 268, 268t, 269t, 270–71
in Kenya, 190–93, 190n10, 191f, 192f, 193f, 253, 253f
in Nigeria, 190n10, 191–93, 191f, 192f, 193f
in South Africa, 190–93, 190n10, 191f, 192f, 193f
General ledger, with FMIS, 151
Ghana case study, 280, 293
challenges with, 295–96, 297–98
de-duplicated system in, 294, 294n32
e-Zwich payment system in, 294–95, 295n34, 296
Ghosts, 134
Global financing, 186–87
Globally standardized data models, 193–94
Global supply chain, 187
Global transparency, tax administration for, 2
Goods and Services Tax (GST), 75, 264
Google, 108
Google Tax, 92
Government
bank accounts consolidation of, 152–53, 153n7
digital technologies for, 182–85
economic outcomes verified by, 25–26, 28
FMIS coverage for, 151–52, 152n3
income redistribution by, 25, 26, 32–35
industry applications for, 185–87
initiatives of, in India, 265–66
response, to digitalization, in India, 262–65
revenue raised by, 25
role of, in digitalization of Kenya, 244–46, 245b
service delivery improvement in, 316, 317–18
stabilization of economy by, 1
technologies adoption of, 7
See also Digitalized government payments
Government digitalization integration
accelerators to, 280, 280nn2–3
cash, to electronic payments, 279, 306–7
challenges of, 295–99
conclusion to, 299
country cases relating to, 286–95
in Estonia, 280
in Ghana, 280
in India, 280
in Mexico, 280
slow progress with, 279–80
Government e-Marketplace, 263
Government monitoring
of cash balances, 163–64
of expenditures, 162–63, 162n10
Government payments, 261, 262–63
cash with, 306–7, 306n2, 307f
in developing countries, 306, 307f, 313, 315, 316, 316f
Government recommendations
digital experimentation engagement, 194
standardize data models nationally and globally, 193–94
standardize process models, 194
Government technology adoption, 7
Gross value-added (GVA), 268, 269t, 270
Group of Twenty, 102, 280
Growth and classification, of P2P activities, 67–69, 69n12
GSMA m-Health deployment tracker, 210, 210n14
GST. See Goods and services tax; Goods and Services tax
GVA. See Gross value-added
H
Haiti, 311, 313
Haver Analytics, 314
Health, 202, 210–11, 211f, 215–16
High-frequency fiscal data availability, 6
High Level Principles for Digital Financial Inclusion, 280
HM Revenue and Customs (HMRC), 114, 116, 124, 124n11, 127, 133
Home bias, 96
Home ownership, 31
Honduras, 310
Horizontal equity principles, 46
Hyperledger, 177
I
IBM, 183, 187
Ease of Doing Business Project, 184–85, 185f
in Kenya, 184–85, 185f
Watson, 178–79
IBM Global Financing, 186–87
Imperfect targeting, for poverty reduction, 227
Import taxation, 106
Income, 12, 12n10, 271–73
corporate income tax, 31, 31n6, 39–40, 391nn7–18
household, 47–49
labor, 32–34, 45
lifetime, 45–46, 46n24
misreporting of, 72–73
redistribution of, 25, 26, 32–35
tax, enforcement of, 35
volatility of, 70, 70n15, 77n23
See also Capital income
India, 286, 295, 313, 316f
Aadhaar in, 287–89, 290n24
Andhra Pradesh in, 289, 310
banking in, 259–60, 260n4, 271, 272f
electronic know-your-customer procedures in, 288
Fair Price Shop in, 289
fuel subsidies in, 290
GDP in, 266, 268, 268t, 269t, 270–71
government payments in, 306
integrated technology projects in, 289
Krishna District in, 289–90
LPG in, 290–91, 290n23
mobile point-of-service devices in, 289
National Payments Corporation in, 297
reform roll out in, 290–91
subsidy, benefit, and pension systems in, 289
tax intelligence and enforcements in, 262
unaccounted income impact, 271–73
Unique Identification Authority of India, 287
India, consequences of digitalization in
betting too much too soon, 274–75
for digital economy challenges, 265
for e-governance, 262, 264–65, 274
for fiscal policy, 259, 261–62
for government initiatives, 265–66
for government payments to individuals, 261, 262–63
for nontax revenues, 261, 263–64
for public procurements, 261, 262
for tax collection, 262
India, digitalization in, 231
conclusion to, 275–76
demonetization decision relating to, 266–74
digital divide with, 261
Digital India, 262, 262n5
Direct benefit Transfer system, 262–63, 266, 274
economic case study of, 18–19
e-District Mission Mode Project with, 265
e-Panchayat with, 265
Financial Intelligence Unit with, 264
Government e-Marketplace, 263
government integration of, 280
government response to, 262–65
GST with, 264
initiatives of, 274–75, 274t
mobile teledensity, 259, 259nn1–2, 261
National Digital Literacy Mission Scheme with, 265, 274
PayGov India, 263
political economy, norms, institutions in, 233, 233n6
Public Financial Management System with, 265
status of, 260–61, 261t
Welfare of the Poor scheme with, 272
India Stack, 296
Indirect taxes, 80, 80n25
Individual and household income, joint taxation of, 47–49
Individual consumption, 30
Individual identification, 3
Indonesia, government payments in, 306, 307f, 313, 315, 316f
Industry applications, for other governments, 185
bond issuance, 186
currency, payments and, 186
global financing, 186–87
global supply chain, 187
welfare disbursement, 186
Inflation
in Kenya, 190–93
in Nigeria, 190–93
in South Africa, 190–93
Informal sector, impact on, 251–53
Information, 38
challenges with, 9–10
collection, processing, and dissemination of, 2
constraints of, 25–26, 32–33, 206
with digitalization, 2–3, 28, 50–52
electronic payment, 32
exchange of, 29, 31
incorrect or incomplete, 116, 118, 122–23
opportunities relating to, 2–6
sharing of, 2
storage capacity for, 2
for tax authorities, 2
from third-party, 29
timely, 2
types of, 28–29
Information costs
of digital revolution, 231–32, 231n5
for targeting, for poverty reduction, 227
Information technology (IT), 149
Integrated Financial Management Information System, 247, 256
Integrated financial management information systems, 7, 7n7
Integrated Tax Management System, 247
Integrated technology projects in India, 289
Intellectual properties (IP), 94
International corporate tax reform. See Digitalization, for international corporate tax reform
International corporate tax regime, 93–97
International corporate tax system, 15
Internet, benefits of, 207
Internet of Tings, 180, 180n6
Interoperability, of digitalization, 297, 297n36
Intragovernmental payment savings, 309t Intra-household transfers, 48
Investment level, with FMIS, 151, 151n2
IP. See Intellectual properties
IT. See Information technology
iTax system, 242, 245, 247–49, 247n2, 248f, 254, 256
J
Jaitley, Arun, 266
Jointness, in tax systems, 43–45, 44n22
Joint taxation
of individual and
household income, 47–49
of labor and capital income, 46–47, 47nn25–26
K
Kenya, 182, 188
blockchain adoption in, 190–93
Central Bank of Kenya in, 244, 245b, 247, 256
Communications Authority of Kenya in, 244, 245b
corruption in, 255, 255f
cost of revenue data, 254f
cost reduction assumptions in, 190–93
Digital Financial System in, 243, 243b, 246, 252, 254, 256–57
Domestic Tax Department in, 247
economies in, 191–93
GDP in, 190–93, 190n10, 191f, 192f, 193f, 253, 253f
IBM project in, 184–85, 185f
inflation in, 190–93
Integrated Financial Management Information System in, 247, 256
Integrated Tax Management System in, 247
Kenya National Bureau of Statistics in, 252
M-Akiba in, 241, 241n1
M-Pesa in, 18, 186, 241–42, 243b, 249, 252, 253, 257
Revenue Administration Reforms and Modernization Program in, 245
tax effort of, 253f
Kenya, digitalization in
government role in, 244–46, 245b
introduction to, 241
with iTax system, 242, 245, 247–49, 247n2, 248f, 254, 256
lessons from, 256–57
with mobile-phone-based financial services platform, 241
progression of, 242–44, 243b, 244f
with Simba system, 246b
for tax administration, 247–49
tax design and revenue administration reforms for, 242–44
Kenya, KRA M-Service in, 247, 250f, 256
informal sector, impact on, 251–53
with new tax categories, 250–51, 251f with pre-iTax KRA
reform agenda, 246b reforms and impact of, 242, 249–55
revenue administration reforms with, 245–46
tax administration, impact on, 253–55, 255f
tax design, impact on, 250–55
Kenya National Bureau of Statistics, 252
Kenya Revenue Authority (KRA), 242
Kosovo, daily fiscal data
access and collection of, 154, 154t, 156
applications of, 160–61, 161f
processing smoothing with, 159, 159f
volatility and noise with, 158, 158f
KRA. See Kenya Revenue Authority
KRA M-Service. See Kenya, KRA M-Service in
Krishna District, India, 289–90
L
Labor, treatment of, 75–76, 75nn20–22
Labor income
joint taxation of, 46–47, 47nn25–26
optimal taxation of, 32–34, 45
Leadership, for digitalization, 296
Leakage, 225, 227, 232
reduction of, 308–10, 311t, 315
Legal framework, for digital technologies, 183–84
Leisure commodities, 32, 36–37
Lifetime earning ability, 45
Lifetime income, taxation of, 45–46, 46n24
Linear commodity taxes, 38, 38n14
Liquified petroleum gas (LPG), 290–91, 290n23
Low incomes, low rents, 69–70, 69n14
Low-tax jurisdictions, 100
LPG. See Liquified petroleum gas
Lump-sum taxes, individualized, 25–26, 33
M
Macroeconomic policy, 15, 16
Macro-fiscal analytical work applications, 167–68, 167n16, 168nn17–18
Maersk, 187
Mahatma Gandhi National
Rural Employment
Guarantee Scheme, 205
M-Akiba, 241, 241n1
Making Tax Digital, 114, 133
Malawi FMIS project, 285, 285b
Marginal tax rates, 32, 33, 43, 45, 227, 229, 232
Market failures, economic development relating to, 17, 202, 205–6, 206n9
McKinsey & Company, 314
McKinsey Global Payments Map, 314
Methodology, for digitalized government payments valuation
calculation of, 311–13
framework for, 308–11, 311t
result extrapolation with, 313–14
Mexican Congress, 292
Mexico, government payments in, 306, 307f, 313, 316f
Mexico case study, 19, 280, 287, 291–92, 291n26, 292nn27–28
challenges of, 295, 296
Micro, Small and Medium Enterprises (MSME), 252, 256
Mobile money, 209
Mobile network coverage, 207
Mobile phone, 212
adoption with, 207
benefits of, 208, 208n13
financial services platform, 241
money transfer, 11
technology with, 2, 17, 201
Mobile point-of-service devices, 289
Mobile teledensity, 259, 259nn1–2, 261
Monitoring
digital, 212
and forecasting real economic activity, 165–66
of government cash balances, 163–64
of government expenditures, 162–63, 162n10
of tax revenue, 160–61, 160n9, 161f
M-Pesa, 18, 186, 241–42, 243b, 249, 252–53, 257
MSME. See Micro, Small and Medium Enterprises
Multinational enterprises, tax administration for, 14, 99
enforcement of, 102
pass-through treatment, 100–101
with S Corporations, 100, 102
shareholders relating to, 100–107
tax base of, 104
tax calculations with, 101–3
third parties relating to, 103–4
Multi-party business interactions, 183
Mutual funds, 101
N
National Audit Office, 124
National Digital Literacy Mission Scheme, 265, 274
National Institute for Public Finance and Policy, 266
National Payments Corporation of India, 297
National Rural Employment Guarantee Scheme (NREGS), 234, 235, 291, 308
National Scholarship Portal, 263
National Social Assistance Programme, 263
Natural experiment, 119
Neutral treatment, of P2P businesses, 72–74, 73nn18–19, 84b–86b
New Dynamic Public Finance literature, 46–47
Niger, 213
Nigeria, 188
blockchain adoption in Nigeria, 190–93
cost reduction assumptions in, 190–93
economy in, 190–93
GDP in, 190n10, 191–93, 191f, 192f, 193f
government payments in, 306, 307f, 313, 315, 316f
inflation in, 190–93
Noncompliance
barriers to, 120
penalties for, 118, 124
policy innovation relating to, 134–35
with tax returns, 116, 118, 119, 122–24, 124n12
Nonlinear commodities taxation, 38, 38n15, 43
Nonlinear tax schedule, 33–38
tagging in, 49–50
Non-take-up rates, 5
Nontax revenues, in India, 261, 263–64
Non-transportable commodities, 38
Nowcashing, with daily fiscal data
applications of, 160–68
characteristics of, 153–59
government bank accounts, consolidation of, 152–53, 153n7
Nowcasting, 150, 150n1, 165
revenue used for, 166–67, 166n14, 167n15
NREGS. See National Rural Employment Guarantee Scheme
O
Occupancy taxes, 74
OECD. See Organisation for Economic Co-operation and development
Online assistance, 115
Online digital tax administration, 113–14, 113n4
Optimal commodity taxes, 38
Optimal income, commodity taxation and, 35–37, 38, 44
Optimal taxation
of capital income, 40–45, 41n19, 44n21
of labor income, 32–34, 45
rate of, 27, 44–45, 49
Organisation for Economic Co-operation and Development (OECD), 31, 75, 91, 95, 102
BEPS project of, 92, 96–97, 104, 109, 123
Overstock, 186
Oxford Economic Global Model, 188, 188n7, 190
P
P2P. See Peer-to-Peer
Pass-through treatment, 100–101
Patent box regimes, 98
Pay-as-you-earn (PAYE), 133, 133n19, 136
PayGov India, 263
Payments
currency and, 186
digitalization with, 280–82, 281b, 281n6, 282nn7–10, 282t
e-Zwich payment system, in Ghana, 294–95, 295n34, 296
intragovernmental payment savings, 309t
See also Digitalized government payments; Government payments
Payments, with digitalization
electronic, 32, 279, 281b, 306–7
rapid expansion of, 280–81, 281n6
types of, 281–82, 282nn7–10, 282t
Peer-to-Peer (P2P) activities, 296–97
in developing economies, 83b
economic impact of, 72
of employees, 67–69, 68f, 69n13
growth and classification of, 67–69, 69n12
of self-employed businesses, 67–69, 68f terminology for, 57–58, 57n2
value of, 58–59
Peer-to-Peer businesses
current tax treatment of, 84b–86b
neutral or targeted treatment of, 72–74, 73nn18–19, 84b–86b
sharing feature of, 60
Peer-to-Peer economy, 4, 12, 14, 60n4
conclusion to, 80–82
definition and reach of, 89
description of, 59
expansion of, 62
impact of, 58
introduction to, 57–59
presumptive tax system for, 76–78, 77n23, 84b–86b
scale of, 61–62, 61t, 62f
theory and empirics on, 59, 62–67
Peer-to-peer economy, taxation and, 57n1, 72–73, 72n17, 77
capital and labor treatment, 75–76, 75nn20–22
implications of, 58
tax thresholds, 74, 75f
technology, for tax administration improvement, 78–80, 79n24
Peer-to-peer economy, tax-relevant features of
with Airbnb, 70, 71f, 75f, 80
externalities, correcting for, 70–71, 71n16, 83b
income volatility relating to, 70, 70n15
low incomes, low rents, 69–70, 69n14
Peer-to-Peer economy, theory and empirics on
empirical results of, 65–67, 65n10, 67n11
shrinking transaction costs, 62–63, 63nn5–6
two-sided markets, 63–65, 63n7
Peer-to-Peer model, 73
as revenue-generating, 60
special tax treatment for, 58–59
Peer-to-Peer platforms, 59n3
characteristics of, 59
commission-based approach of, 60
control of, 60
criticism of, 58
as data recorders, 71–72
features of, 60
rapid ascension of, 58
role of, 58, 59–61
across sectors, 59t
Peer-to-Peer services, cross-border taxation of, 75
Peer-to-Peer trading, 58
Penalties, for noncompliance, 118, 124
Perfect targeting, 226, 229
Permanent establishments (PEs), 94, 95–96, 109, 109n22
PFM. See Public financial management
Philippines, 311, 313
Pigouvian taxes, 71
Pitfalls, of digital technologies, 216–18
Platforms, 10
digital, 14
peer-to-peer, 58–61, 59n3, 59t, 71–72
web-based, 59
Policy innovation
consumption tax relating to, 136–37, 136n23
with dataset linkage, 135–36
with digitalization, 135–36, 135n22
error reduction with, 134
ghosts relating to, 134
noncompliance relating to, 134–35
PAYE, 133, 133n19, 136
Political economy, norms, institutions, 235
digitalization with, 233
in India, 233, 233n6
poverty line relating to, 233
proxy means tests, 233–34
qualitative studies relating to, 234
switchpoint, 233
Political economy, targeting relating to, 227, 227n3
Poorer household focus, 317
Positive taxes, on capital income, 41
Poverty gap, 226
Pradhan Mantri AJan Dhan Yojana, 259–60, 259n3, 288, 318
Pre-iTax KRA reform agenda, 246b
Pre-population, 9, 113, 113n3
Pre-population experiments, 115, 115n8, 117
with audit rates, 122–23
compliance relating to, 116, 117b, 118–23
economic experiments, 117b
HMRC associated with, 116
with incorrect or incomplete information, 116, 118, 122–23
natural experiment, 119
third-party data relating to, 116
with U.K. taxpayers, 119–27, 120n10, 121f, 122f
with undergraduate students, 118–19
Presumptive tax system, 76, 84b–86b
costs relating to, 78
deductions with, 78
de minimus tax, 77
implications of, 77
income volatility relating to, 77n23
for small businesses, 77
Price-setting ridesharing industry, 58, 74
Primary earners, 48
Privacy
challenges of, 10
with digital technologies, 184
Production inefficiencies, 39, 39n17
Productivity boost, 319–20
Profits, 99
business-level tax of, 103
to shareholders, 100, 100nn9–11, 102n13
source of, 104–5
Profit shifting, 14, 97–99, 104
Program Keluarga Harapan transfer program, 234
Programmable era (1950s-present), 175–76
Progressive consumption tax, 34–35, 48n27, 136
Property registers, 31, 31n5
Property taxes, enforcement of, 29
Proportional consumption tax, 34
Proxy means tests, 232, 233–34
Public accounting systems, with FMIS, 152, 152n4
Public expenditure, for poverty reduction
conclusion to, 235–36
digital revolution, implications of, 230–35
leakage to nonpoor, 225, 227, 232
new technology for, 225
targeting fundamentals, 225, 226–30, 231
Public finance
cognitive applications to, 179–82
PFM and, 15–16, 19, 279, 295, 298, 299
Public finance, reshaping of, 1
with digitalization, 2–6
forward looking for, 11–12
with individual identification, 3
with information collection, processing, and dissemination, 2
new challenges for, 7–11
new opportunities for, 2–6
for private sector, 3
summary of, 12–21
Public financial management (PFM), 15–16, 19, 279
functionality of, 295–96
traditional approaches to, 295
Public financial management, digitalization and
cash reduction with, 283
complementarity relating to, 282–84, 283nn11–12
cost benefit of, 286, 286n18
de-risking with, 283, 283n14
FMIS implementation with, 284–86, 284nn15–17, 285b
quality of information with, 283, 283n13
Public Financial Management System, 265
Public procurements, in India, 261, 262
Public service delivery, 4–5, 12–13, 17–18
Public service provision. See Digital technologies, for public service provision
Public spending, 1, 4–5, 12–13, 17–18
R
Ramsey inverse elasticity rule, 37n13
Randomized control trial (RCT), 212, 213, 214, 215
R&D activity, 98, 104, 105
Real-time macroeconomic analysis, 149–50
Real-world tax systems, 43
Receipts savings, 309t
Reforms and impact, of KRA M-Service, 242, 249–55
Regulatory requirements, for digitalization, 297
Reserve Bank of India, 297
Residence basis, for capital income, 40
Residence countries, 93
Resources
to enable public spending, 1
to pursue distributional objectives, 1
for stabilization of economic policy, 1
Revenue, 12–15, 25, 155b
collection of, 181–82
data cost for, 254f
for nowcasting, 166–67, 166n14, 167n15
tax revenue monitoring and forecasting, 160–61, 160n9, 161f
Revenue administration reforms, 242–44
with KRA M-Service, 245–46
Revenue Administration Reforms and Modernization Program, 245
Revenue-generating, P2P model as, 60
Risks
de-risking, 283, 283n14
of digitalization, 298
taxpayers, 4, 25
Robot capital, 11–12, 12n9
S
Safaricom, 242–43, 249
Savings, 308
Savings sources, for government payment transactions
expenditures, 309t
intragovernmental payments, 309t
receipts, 309t
S Corporations, 100, 102
Self-employed businesses, 67–69, 68f
Self-employment, 126, 126n14
Self-targeting, 228
Senegal, currency in, 186
Sequencing, with digital technologies, 184–85
Shareholders
capital gains of, 100, 101
dividends of, 101
location of, 99–103, 99n8
in low-tax jurisdictions, 100
in multinational enterprises, 100–107
profits to, 100, 100nn9–11, 102n13
tax returns of, 100–101
Sierra Leone, 309
Simba system, 246b
Single-platform approach, to digitalization, 10
Slovenia, daily fiscal data for
access and collection of, 154, 154t, 156
applications of, 164, 164f, 164n13
process and smoothing with, 159, 159f
Small and medium enterprises (SMEs), 252, 256
Smartcards, 291
SMEs. See Small and medium enterprises
SMS, 208, 214, 215, 217, 249
Social protection programs, 210–11, 211f
digital technologies for, 202, 213–14
with public service provision, 204–5, 204n7
Social Security Pension (SSP) schemes, 291
Source countries, 93
South Africa, 188, 230, 310
blockchain adoption in, 190–93
cost reduction assumptions in, 190–93
economy in, 190–93
GDP in, 190–93, 190n10, 191f, 192f, 193f
government payments in, 306, 307f, 313, 316, 316f
inflation, 190–93
SSP. See Social Security Pension
Standardized national and global data models, 193–94
Standardized process models, 194
status of, 260–61, 261t
Statutory tax rates, 32
Sub-Saharan Africa, 207
Subsidiaries, digitalization relating to, 94, 95
Subsidies, with targeting, for poverty reduction, 229
Subsidy, benefit, and pension systems, in India, 289
Subsidy reduction, 318
Switchpoint, 233
Synthetic capital income tax, 42, 46n23
T
Tabulating era (1900–70), 175
Tanzania, 310
Targeted treatment, of P2P businesses, 72–74, 73nn18–19, 84b–86b
Targeting, for poverty reduction, 225nn1–2
budget for, 226
categorical, 229
efficacy relating to, 227
fine, 227–28, 229, 232, 233
Foster-Greer-Torbecke class of poverty indices, 226
fundamental principles of, 225, 226–30, 231
high marginal tax rates
relating to, 227, 229
imperfect, 227
incentive system with, 228, 229
information costs for, 227
measurement of, 226
perfect, 226, 229
political economy relating to, 227, 227n3
poverty gap, 226
self-targeting, 228
subsidies relating to, 229
transfers relating to, 226, 228–29
Taxable income, elasticity of, 33
Tax administration, 115n6, 124–38
for bookkeeping, 4
digital, 113–15, 113n3, 139–40
digital experiments with, 113n1, 113n4, 115–24, 115n8
with digitalization in Kenya, 247–49
for electronic tracking, 3–4
enforcement with, 13–14, 25–26, 34
global transparency of, 2
impact on, 253–55, 255f improvement of, 78–80, 79n24
multinational enterprises, 14, 99, 100–107
opportunities for, 3–5, 12–13, 17–18
problems with, 8–9
revenue administration and, 12–15
systems for, 3–4
for taxpayer risk, 4, 25
Taxation, 106
of corporate income, 39–40
double, 93
incidence of, 73
of lifetime income, 45–46, 46n24
P2P economy and, 72–80
problems with, 8–9
in two-sided markets, 64, 64n8
See also specific taxations
Taxation, digitalization and conclusion to, 50–52
enforcement of, 27–32
introduction to, 25–27
tax design, 27, 32–50
Taxation Information Exchange Agreements, 31, 32
Tax base reduction, 9
Tax calculations, of multinational enterprises, 101–3
Tax collection
demonetization, impact of, 268–71, 268t, 269f, 269t, 270f, 271n10, 272f
in India, 262
Tax competition, 40, 98–99, 104
Tax compliance. See Taxpayer guidance, for tax compliance
Tax design, 27, 32–50
impact on, 250–55
and revenue administration reforms, 242–44
Tax design, digitalization and
commodities taxation, optimal income and, 35–37, 38, 44
jointness, in tax systems, 43–45, 44n22
joint taxation, of individual and household income, 47–49
joint taxation, of labor and capital income, 46–47, 47nn25–26
law enforcement costs, tax complexity and, 50
optimal taxation, of capital income, 40–43
optimal taxation, of labor
income, 32–34, 45
progressive consumption taxes, 34–35, 48n27
tagging, in nonlinear tax schedules, 49–50
taxation, of corporate income, 39–40
taxation, of lifetime income, 45–46, 46n4
Tax enforcement, 36, 36n12
administration of, 13–14, 25–26, 34
cost and complexity of, 50
of digitalization and taxation, 27–32
evasion and, 316, 319–20
of income taxes, 35
of multinational enterprises, 102
of property taxes, 29
technology of, 27–28
Taxes, 2, 109
based on destination, 104–6, 106nn17–19
business-level tax of profit, 103
De minimus, 77
evasion of, 27–29, 28n2, 31, 32, 316, 319–20
flat-tax rate, 78
Google, 92
Kenya and, 250–55, 253f, 255f
marginal rates of, 32, 33, 43, 45, 227, 229, 232
nonlinear tax schedule, 33–38, 49–50
on profit, 99
See also specific taxes
Tax-free exemption, 42–43, 42n20
Tax intelligence and enforcements, in India, 262
Taxpayer guidance, for tax compliance, 15, 124–32, 124n11
digitalization, tax policy and, 133
future of, 138–39, 138n27, 139n28
policy innovation relating to, 133–37
tax policy foundation, 137–38, 137n24, 138n26
Taxpayer guidance experiments
components of, 127–28
design for, 124n13, 125–28
with ECUs, 126
focus of, 127
instructions for, 127
profile for, 126, 126f
results of, 129–32, 129t, 130f, 130t
self-employment relating to, 126, 126n14
survey for, 132
treatments for, 127, 128–32, 128t, 130f, 130t, 131t
Taxpayers
risk of, 4, 25
U.K., pre-population experiments with, 119–27, 120n10, 121f, 122f
Tax policy
digitalization and, 133
enforcement of, 13–14
foundation of, 137–38, 137n24, 138n26
Tax reform. See Digitalization, for international corporate tax reform
Tax returns
compliance with, 124
noncompliance with, 116, 118, 119, 122–24, 124n12
pre-population of, 9
of shareholders, 100–101
Tax revenue monitoring and forecasting, 160–61, 160n9, 161f
Tax systems
cross-dependencies in, 43
dual-income-tax system, 41, 42, 43
jointness in, 43–45, 44n22
Tax thresholds, 74, 75f
Tax treatment, of P2P businesses, 58–59, 84b–86b
TE. See Transportation and handling expenses
Technological advances, digital trust with, 174
Technologies, 149, 225
blockchain, 10, 11, 12, 16
deep-learning, 1
for government, 182–85
government adoption of, 7
Government technology adoption, 7
harnessing of, 16–17
integrated projects of, in India, 289
mobile phone, 2, 17, 201
shaping of, 12
for tax administration improvement, 78–80, 79n24
for tax enforcement, 27–28
See also Digital technologies, for government; Digital technologies, for public service provision
Telecommunications regime, 297
Testing and implementing, of digital tax administration, 113–15
Theory and empirics, on P2P economy, 59, 62–67
Third parties, 29, 103–4
Third-party data, with pre-population experiments, 116
Third-party reporters
consumers as, 32, 51
financial institutions as, 31–32, 51
Tourism taxes, 74
Transactional fraud, 183
Transparency of Financial Services Law, 292
Transparency Portal, 155
Transportation, with economic development, 203
Transportation and handling expenses (TE), 188–90, 189n9
Treasury single account (TSA), 151, 152–53, 153n7, 165
Tunisia, 186
Two-sided markets, 63n7, 107–8
academic literature on, 63–64
features of, 63–65
rental activities relating to, 65, 65n9
taxation in, 64, 64n8
U
Uber, 174
U.K. taxpayers, pre-population experiments with, 119–27, 120n10, 121f, 122f
Unaccounted income impact, in India, 271–73
Undergraduate students, pre-population experiments with, 118–19
Unified Payments Interface, 297
Unique Identification Authority of India, 287
United Kingdom, welfare
disbursement in, 186
United States, daily fiscal data and access and collection of, 154, 154t, 156
applications of, 166–68, 167f
processing and smoothing with, 159, 159f
Universal basic income, 12, 12n10
V
Value-added tax (VAT), 29, 51, 74, 80n26, 166
cross-checking of, 4
fraud relating to, 8–9
international, 75
issues with, 92, 106
reduction of, 7, 35, 35n11, 80
revenue case, 155b
third-party reporter for, 32
Volatility, noise and, 156–58, 158f
W
Watson, 178–79
Web-based platforms, 59
Welfare disbursement, 186
Welfare economics, 33
World Bank, 207, 266, 314, 314n4, 319
FMIS relating to, 151
World Bank Independent Evaluation Group, 284
X
X-Road, 296
Z
Zimbabwe, 310