IV.4. Providing opportunities for
voluntary disclosure
In some cases, taxpayers may not pay their tax on time because
of severe personal circumstance or have unintentionally provided incorrect
information or made an honest mistake on their tax return. In these situations,
if the tax administration came down heavily on the taxpayers with punishments
and penalties, the taxpayers are likely to `rebel' and lose respect for the tax
authority - this is likely to have an impact on future compliance behaviour as
well. Therefore, the tax administration should provide taxpayers with the
opportunity to voluntarily disclose. For example, RRA Voluntary Disclosures
Policy allows taxpayers to come forward and correct inaccurate or incomplete
information or disclose material they did not report during previous dealings
with the RRA, without penalty or prosecution.
IV.5. Using informants and tax evasion
referral hotline
RRA provides avenues for taxpayers to report incidents of tax
evasion (usually anonymously), with a number offering rewards in cases where
information provided leads to a legitimate discovery of tax evasion.
Article 4 of the Ministerial order No 002/07 of 09/05/2007
governing the implementation of the law No 25/2005 of 04/12/2005 on tax
procedure states that «an amount equivalent to ten percent (10%) of the
value of fines and penalties prescribed in Chapter XI of law No 25/2005 of
04/12/2005 on Tax Procedures should be given as an award to any person who
denounces a taxpayer who engages in the tax fraud.»
Also Article 143 of the Ministerial decree No 003/07 of
09/05/2007 implementing the law No 21/2006 of 28/04/2006 establishing the
Customs System provides that «persons providing information outside their
areas of responsibility that contributes to establishing customs offences that
leads to subsequent recovery of duties and taxes should be granted a reward
equivalent to ten percent (10%) of duties and taxes recovered.»
IV.5.1 Involving taxpayers in consultative forums
By consulting with taxpayers, RRA designs processes, systems
and legislation that are likely to be better accepted by taxpayers, hence
increasing voluntary compliance. RRA should provide opportunity for taxpayers
to voice their opinion on any changes and new initiatives. Also RRA should, or
regular basis, conduct formal taxpayer surveys to gather taxpayer feedback.
IV.5.2 Intermediary assistance and education
The tax administration should acknowledge the important
contribution that intermediaries make in assisting the tax authority to combat
Tax offences and encourage voluntary compliance. Intermediaries do not only
include tax practitioners (i.e. accountants, tax and clearing agents,
book-keepers) but also lawyers, auditors, banks, post offices, transporters,
industry associations, professional bodies, etc. Intermediaries can be used to:
· Identify new areas of risk (e.g. by reporting
suspicious transactions or practices)
· Act as distribution channels for the tax administration
(e.g. taxpayers can make payments via banks; tax practitioners can disseminate
information on new legislation or new initiatives to their clients)
· Help inform or test new policy/legislation or
initiatives to ensure they will resonate with the proposed target audiences -
intermediaries are often in a better position to understand the business
realities faced by operators
· Identify new ways or options for dealing with emerging
issues or better meeting the needs of client groups
· Help promote and encourage compliant behaviour (e.g.
tax agents may advise their clients of areas of risk).
Given the importance of intermediaries, it is important that
RRA should pursue measures to ease the burden on them, particularly for tax
advisors and tax and clearing agents who frequently liaise with the tax office.
Many of the customer service initiatives that RRA is currently pursuing for
taxpayers, such as the development of electronic services and provision of
information, can also be undertaken for intermediaries.
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