Annex 1. ISORA 2018 Participation

Annex Table 1.1.

ISORA 2018 Participants by IMF Region and World Bank Income Group1

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Note: Numbers in parentheses are the number of jurisdictions per row or column. HICs = high-income countries; LICs = low-income countries; LMICs = low-middle-income countries; UMICs = upper-middle-income countries.

Countries identified as fragile according to the IMF 2019 classification are shown in red.

Annex Table 1.2.

ISORA 2018 Participants by Supporting Partner Organization1

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Economies that participated in both ISORA 2016 and 2018 are shown in black; economies that did not participate in ISORA 2016 are shown in blue.

Annex Table 1.3.

ISORA 2018 Participants by Standard Grouping and by IMF Region

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Annex 2. ISORA 2018 Data Set Topics Not Discussed in this Publication

This annex provides reference information for data sets from ISORA 2018 that are not specifically discussed in this publication. Items marked with an asterisk have been previously discussed in the equivalent document relating to ISORA 201642:

  • Academic qualifications

  • Administrative sanctions for non-disclosure

  • Advance payments

  • Audit case selection criteria*

  • Audit performance measurement

  • Automatic Exchange of Information

  • Capital expenditures

  • Cash payment

  • Cooperative compliance

  • Debt collection powers*

  • Electronic invoicing

  • Fees for service

  • Filing frequency regimes

  • Fiscal year ends and accrual/cash accounting

  • Fragile states*

  • Full time, part time, contractual staff

  • Information gathering powers*

  • Innovation

  • Office networks for tax administration

  • Organizational features

  • Outsourcing of activities*

  • Percentage of revenue formula

  • Policy advice to finance ministries Pre-filling of tax returns

  • Refunds

  • Reporting details of taxes withheld

  • Reviews by external bodies

  • Rulings

  • Service demand channels

  • Small and medium enterprises

  • Tax crimes

  • Taxpayer complaints

  • Taxpayer Identification number

  • Tax intermediaries

  • Time limitations for audit interventions

  • Treatment of VAT credits

  • VAT return types by income group

  • Voluntary disclosures

  • Withholding systems

Annex 3. Composition of Indices

Annex Table 3.1.

Management and Human Resources Autonomy

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Annex Table 3.2.

Public Accountability

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Annex Table 3.3.

General Management

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Annex Table 3.4.

Human Resource Management

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Annex Table 3.5.

Service Orientation

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Annex Table 3.6.

Compliance Risk Management Foundations

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Annex Table 3.7.

Degree of Digitization

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References

  • Asian Development Bank (ADB). 2018. “A Comparative Analysis of Tax Administration in Asia and the Pacific.” Manila.

  • Asian Development Bank (ADB). 2020. “A Comparative Analysis of Tax Administration in Asia and the Pacific.” Manila.

  • Inter-American Center of Tax Administrations (CIAT). 2016. The Revenue Administrations in Latin America and the Caribbean 2011–2013. Panama City: CIAT.

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  • Inter-American Center of Tax Administrations (CIAT). 2018. “Tax Administrations: Collection, Costs and Personnel Evidence for the CIAT Countries with Data of ISORA.” Working Paper WP-02-2018, Panama City.

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  • International Labour Organisation (ILO). 2018. Labour Force by Sex and Age. Geneva.

  • International Monetary Fund (IMF). 2006. “Revenue Authorities: Issues and Problems in Evaluating Their Success.” IMF Working Paper 06/240, Washington, DC.

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  • International Monetary Fund (IMF). 2015a. “Understanding Revenue Administration. An Initial Data Analysis Using the Revenue Administration Fiscal Information Tool.” Fiscal Affairs Departmental Paper, Washington, DC.

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  • International Monetary Fund (IMF). 2015b. “IMF Engagement with Countries in Post-Conflict and Fragile Situations— Stocktaking.” IMF Policy Paper, Washington, DC.

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  • International Monetary Fund (IMF). 2015c. “Current Challenges in Revenue Mobilization: Improving Tax Compliance.” IMF Staff Report, Washington, DC.

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  • International Monetary Fund (IMF). 2017. “Understanding Revenue Administration. Results from the Second Survey of the Revenue Administration – Fiscal Information Tool.” Fiscal Affairs Departmental Paper, Washington, DC.

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  • International Monetary Fund (IMF). 2018. “2017 Staff Guidance Note on the Fund’s Engagement with Small Developing States.” IMF Policy Paper, Washington, DC.

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  • Organisation for Economic Co-operation and Development (OECD). 2016. Advanced Analytics for Better Tax Administration: Putting Data to Work. Paris: OECD Publishing.

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  • Organisation for Economic Co-operation and Development (OECD). 2017. Tax Administration 2017: Comparative Information on OECD and Other Advanced and Emerging Economies. Paris: OECD Publishing.

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  • Organisation for Economic Co-operation and Development (OECD). 2019. Tax Administration 2019: Comparative Information on OECD and Other Advanced and Emerging Economies. Paris: OECD Publishing.

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1

Not all participants are sovereign states, but all are members of one of the international partner groups or have a relationship with one of the IMF Regional Capacity Development Centers.

2

This is in contrast to TADAT, which is a formal evidence-based tool to assess tax administrative performance in the context of international good practice.

3

For a discussion of revenue administration data collection and reporting and analytical assessment tools see: Reforms of Tax Administration and Systems: A Mapping of Current Analytical Tools and Frameworks (Norad Report 3/2020).

4

Total data points is the best measure of the size of the Survey. A data point is simply a point in the online survey where a participant must insert a response. ISORA comprises two types of questions from which data points can be calculated: (1) categorical questions—yes/no questions and check boxes; and (2) numerical questions—specific currency, volume, or percentage inputs. Categorical questions are relatively straightforward, they do not require detailed data reporting systems, and tend not to change much year over year. Numerical questions on the other hand require participants to maintain up-to-date reporting systems and almost always change from one year to the next.

5

The World Bank groups countries by 2017 gross national income per capita as follows: low-income countries—$995 or less; lower-middle-income countries—$996 to $3,895; upper-middle-income countries—$3,896 to $12,055; and high-income countries—$12,055 or more.

6

In ISORA 2016 Understanding Revenue Administration 18 fragile state participants were identified using the IMF 2015 classification. Using the IMF 2019 fragile state classification, there would have been 19 participants.

7

FCS Strategy Concept Note. 2021. Washington DC: International Monetary Fund (unpublished).

8

In both rounds of ISORA the online data collection platform requires a response to all applicable questions. In the case of numerical responses, however, the response may be a ‘D’ which denotes that the data are not available. The response rate is determined as the ratio of the number of numerical inputs provided for a particular question (excluding Ds, and zeroes where appropriate), to the number of responses that should have been provided.

9

Table 4 shows that most jurisdictions with a population of under 1.5 million are either UMICs or HICs. There is some differentiation evident between Lower- and Higher-Income Small States, but the differences are more muted by income group than is the case for larger jurisdictions. For example, resourcing measures such as taxpayers per full-time-equivalent, or population to full-time-equivalent which are very different for the Higher-Income and Lower-Income groups of administrations (see Figure 21) varies less by income group among the Small States.

10

This measure is discussed in full in Section C, and it covers taxpayers registered for PIT, CIT and VAT, and employers registered for PAYE.

11

Three countries moved from the lower-income to higher-income grouping, while one transitioned from the higher-income grouping to the lower-income grouping. The IMF largely follows changes in the World Bank income classifications.

12

The Addis Tax Initiative is a multi-stakeholder partnership that aims to enhance domestic revenue mobilization in partner countries (see http://www.addistaxinitiative.net).

13

These are direct taxes such as PIT and CIT and indirect taxes such as VAT and other goods and services taxes. Main taxes are sometimes called core taxes (for example, in TADAT where this includes social security contributions where they are a major source of revenue and domestic excises).

14

Roughly equal numbers of participants provide the number of expected returns or the number of on-time returns. However, not all these participants provide both figures. For example, 111 and 108 participants provided figures for expected and on-time returns for CIT, but only 103 provided both figures.

15

See IMF. 2019. ISORA 2016: Understanding Revenue Administration. The percentages in Figure 8 do not correspond exactly with the figures used in the ISORA 2016 analysis, as that publication used percentages only from countries that provided data for all six years (2010–15).

16

Some medians of more than 100 percent are observed. As the on-time payment rate is calculated as the ratio of on-time payment to expected payments, the rate will be greater than 100 percent if the estimated expected payment is less than the on-time payment. Many administrations report larger values for on-time payment than the expected payment. The reason for this is not clear.

17

“Deemed acceptance” refers to returns that are fully pre-filled by the administrations and do not require a response from the taxpayer.

18

Both measures are used in TADAT.

19

TADAT defines the measure as “the value of total core tax arrears at fiscal year-end as a percentage of total core tax revenue collections for the fiscal year.” The numerator in this ratio, that is, total core tax arrears, includes all core tax arrears including penalties and interest, both collectible and uncollectible. The denominator includes the total amount of core tax collected (net of refunds) by the tax administration during the year.

20

Some ISORA partners only focus on tax administration and as such do not regard VAT on imports as a tax collected by the tax administration.

21

For a more complete discussion of these cautions, see the previous IMF publication — ISORA 2016; Understanding Revenue Administration, p. 29.

22

TADAT does not deal with any specific measures for verification results, or coverage or adjustment rates. It focuses more on the qualitative aspects of verification programs, their application to core taxes, the use of risk-based case selection, and the like. TADAT notes that verification programs have a far wider import than simply raising additional revenues—they also have critical roles in providing a deterrent and obtaining intelligence for the administration.

23

See ISORA 2016: Understanding Revenue Administration, pp. 36–37.

25

OECD surveys that underpinned the Comparative Information Series and more lately the Tax Administration Series have used this since 2004.

26

“RA refers to a governance model for revenue administration where traditional ministry of finance departments (tax and usually customs administrations) are established as an organization or agency with a degree of autonomy from government and independence from standard public service policies. A more precise definition of RA is not really possible since these governance models cover a range on a spectrum.” IMF. 2006. “Revenue Authorities: Issues and Problems in Evaluating Their Success.” IMF Working Paper, Fiscal Affairs Department.

27

This may be related to economies of scale. Post ISORA 2018, there has been growing interest from Small States in exploring the RA model.

28

The IMF is currently conducting research into issues and practices related to semi-autonomy, including the role of boards in tax administration—the results of this research are expected to be published in 2021.

29

TADAT uses the term ”core taxes” which, in addition to the ”main taxes” described in this document, also includes social security contributions (where a major source of revenue) and domestic excise taxes.

30

This will include reported values for VAT on import whether collected by a comanaged tax and customs administration or by a customs-only administration.

31

Tax Administration: includes functions both at headquarters and operating offices related to – Registration and Taxpayer Services – taxpayer registration, taxpayer services, and education; Returns and Payment Processing – processing returns (including electronic returns), processing payments (including electronic payments), reconciling accounts and processing refunds; Audit, Investigation, and Other Verification – audit, investigation, and other tasks involved with verification of taxpayer statements and claims; Enforced Debt Collection and Related Functions – debt collection and enforcement; Dispute and Appeals – management of objections and appeals; ICT – activities related to ICT infrastructure, software development, ICT security, maintenance, and any other ICT functions; Other Functions – activities not covered by the prior descriptions.

32

For these staff demographic elements of ISORA, most participants representing comanaged tax and customs organizations provided data based on their entire organization.

33

International Labour Organisation. 2018. Labour Force by Sex and Age, www.ilo.org/ilostat

35

No definition of “executive” was provided in ISORA 2018. From scrutiny of the data it is evident that the meaning of “executive” varies among tax administrations: the ratio of “executives” to staff provided by 11 administrations is more than a third, while the ratio is less than 1 percent for 18 administrations. Thus, the individual ratios for participants are not necessarily comparable.

36

ISOCA 2018, the product of collaboration between the IMF and World Customs Organization, was a prototype survey to test the survey instrument and processes. Participation rates were lower than ISORA participation rates and anticipated survey rates in the full survey. Despite this, staff gender data were provided by over 20 customs administrations that are not administered jointly with a tax administration.

38

The ISORA survey asks participants to indicate the LTO/P share of total net revenue, defined as including CIT, PIT, VAT, employer withholding taxes, as well as other revenues.

39

This calculation uses active taxpayers where the data are provided, or total taxpayers where active is not provided.

40

A discussion on criteria for audit case selection can be found in this publication’s predecessor—ISORA 2016 Understanding Revenue Administration. These criteria are essentially the same for ISORA 2018 as they were for 2016.

41

It is recognized that each yes/no question in each index does not necessarily have the same ”weight” in scoring the value of the index. Therefore, depending on a judgment of the relative importance of the question to the index at hand, the authors have assigned a weighting of 1, 2, or 3 to each question, based on their collective experience in tax administration.

42

IMF. 2019. ISORA 2016. Understanding Revenue Administration. publications@imf.com. This publication also contains aggregate statistics related to fragile states.

Understanding Revenue Administration: International Survey on Revenue Administration 2018
Author: William Crandall, Elizabeth Gavin, and Mr. Andrew R Masters