Tomorrow can’t come soon enough for today’s Tax Inspector
Tax agencies around the world are picking up the pace of their digital transformations. This is good news for Tax Inspectors assessing the potential impact of disruptive digital technologies on their roles. It’s not just the old mantra of using digital to ‘do more with less’ but the fact that, at last, they have some exciting new tools with which to tackle fraudsters, tax evaders, and error.
Today’s Tax Inspector often struggles to match a taxpayer’s declared income with his or her economic and social activity. They find themselves having to react to non-compliance or fraud, rather than preventing it in the first place by identifying risk early in the tax cycle.
Tomorrow’s Tax Inspector will operate in a very different world. In fact, digital tools and approaches have already transformed outcomes in a handful of tax agencies. For example, in Italy the tax authorities are using a digital ‘income meter’ to spot people living above their stated means. And the UK tax agency HMRC’s strategic risking tool Connect helped to prevent £330 million fraudulent VAT repayments in its pilot phase alone.
These agencies understand the huge impact of digital on their Business Intelligence. Others are following suit, or planning to. This can’t come soon enough for Tax Inspectors battling increasingly digitally-savvy fraudsters.
Big data, fraud analytics and upstream predictive modelling will help them transform their understanding of potential tax avoiders and prevent misinformation and error getting into the system. Tomorrow’s digital tax agency will draw together customer information in one place in a personalized tax account, making it easier for the Tax Inspector to manage.
With so much potential, I feel sure that many of today’s Tax Inspectors are impatient for tomorrow.
Find out more by downloading our brochure or contact me if you’ve got a digital tax story you’d like to share.