1. Organization and management of tax administration

The organization and management of the Tax Administration (TA), must correspond to the reality of each country and the strategic objectives it has deceased. Indeed, in a federal country, which wants to emphasize the geographic decentralization and that the taxes collected in each province will remain in it, it will decentralize the decisions of the TA at provincial level. In another country, where the agricultural and non-urban realities are very different in its taxation, it may be advisable to subdivide into two entities specialized AT

The strategic goals of various Old Testament also may be different, because for some, the main objective is to increase revenues in the shortest time possible, or to others may favor a better service to taxpayers, and so on.

How to organize and administer the TA will also depend on the selected strategic objectives.

This article will explore key aspects of the organization and management of TA, namely, organizational structure, management control, privatization of some of its activities, the civilian career officials, their training and professional ethics.

2. Organizational structure of the AT

The hundreds or thousands of staff of AT should be grouped into directorates, departments, units, etc.., Each with their respective functions, powers and headquarters. To make this subdivision is often used a combination of the following criteria:

1. Geographic. The officials shall be divided into units whose liability is limited to the control and care of a group of taxpayers located in a particular geographical area for each of these units.

2. Functional. Officials may also be grouped into different specialized units in some areas of work of the AT: finance, personnel, audit, legal, information technology.

3. For Tax. Staff members may belong to different units, each responsible for overseeing and managing a different tax: VAT, income, land, inheritance, etc. fuels.

4. By type of taxpayer. Officials will be grouped in various specialist units by type of taxpayers, according to their size (large, medium and small) or economic activity (agriculture, commerce, industry, mining, etc.)..

For example, one possible organization of AT may be that 20% of its staff belong to the Central and the remaining 80% distributed to the different units throughout the country, according to geographical criteria. The Central Directorate Staff Departments will be organized according to functional criteria. In each geographic unit, its staff will also be subdivided and specialized according to functional criteria. As a result, functional managers in the regions will have regional head hierarchical dependence, but a functional dependence of the head of Department for the corresponding function in the Central. Within the teams undertaking the audit function in each of the territorial units, subspecialty may shop by type of taxpayer, economic sector, and / or by type of tax.

AT coexist within the diverse staff: Executives, professionals, management and support, which develop different functions. Professional and human characteristics, number and location within the TA should be decided by each country, depending also on their strategic objectives.

In each AT must also decide on the rules that will govern the powers and delegations for decision making.

As a way to make it more agile and effective management of the TA, will tend to have a policy of broad delegation to the lower layers of the organization and to the regional units. This will require highly skilled staff in middle management of the TA.

Also administrative procedures must be designed to control how they are exercising delegated authority through the organization, relying on Computer Information Systems as appropriate.

Management and control costs in tax administration

Based on the strategic plan of the TA, it is necessary to define the core objectives or goals for each unit to get it, quantifying and specifying the maximum. For example, the functional unit responsible for auditing the AT, it is necessary to define and clarify what is meant by good supervision and what are you going to ask the watchdog function. We will have to define what is a good overall management of that task that will regulate or management, mediocre. In the same way, this exercise must be repeated for the remaining features of the TA, as well as for other units, such as regional offices. This is important because not all staff necessarily belong to a geographic unit or function is understood to mean a good or bad management of his respective unit, or perhaps understand different things and that through the exercise of defining precisely what is expected of these units lead to a better future coordination of the work of these units in the TA.

Subsequently, the TA should make an effort to define policies for each of these areas for each function and for each topic covered by the AT. These policies should be general in nature and not go to a level of detail which means defining the procedures. For example, if you are defining the wage policy of the TA, suffice to say that you want to have a difference of no more than 20% with private sector wages in the ancillary areas - administrative change in the area of professional and managers may have a difference of up to 30%. This is not at this stage to define in detail the salaries of individual staff members of the AT, but to be precise enough to know what to expect in terms of other policies of the TA and to be able to make consistent with management them.

Once defined policies in the TA, it is useful for management planning. This will make overall plans for the AT, both annual and five-year, but broken out by each of its units. These plans should take firm qualitative goals defined in very precise and also trying to measure. If many goals can not be quantified, at least you can measure some elements of them. For example, if we are to improve service to taxpayers, may make some measurements, such as average waiting time to have when they attend the offices of the AT, or calculating how much it costs taxpayers comply with regulations imposed by the AT This will be done case studies, segmenting taxpayers into small, medium and large, and perhaps, by economic sector. Based on these samples, we may have a station which is the burden placed on individual taxpayers as a result of legislation and practices of the TA.

In order to have adequate management control, it will be important to keep statistics, which will enable the corresponding controls of various units or areas of the TA. These statistics should target the main or key variables that account for the way they are behaving the respective efforts of the units and their annual plans. We will have to try to have few statistics for each area, since having a multiplicity of statistics or data, apart from the more expensive it means its maintenance, also difficult to prioritize and effectively serve these statistics for decision making. Procedures shall be defined regular monitoring of progress of the annual plans and redefined according to the results of these checks.

The TA must also be extremely rigorous in the way it makes its annual budget allocation and in monitoring compliance with this course, which should be consistent with the goals and annual plans. It is necessary that these in turn are consistent with policies for areas and functions, and the objectives and measures of overall excellence that have been defined earlier.

Parallel cycle management and budgetary control as defined above, can perform various other activities. The first is the cost study. This should begin with those procedures or activities which, by preliminary data, mean a substantial part of the cost of the TA.

For each of these activities will require a detailed cost study and try to lower them, either through reduced usage of the activities that lead to these costs, either by simplifying the procedures used by the AT. Another possibility for computational work is to support the tasks required for this activity.

Finally, it is necessary to analyze the importance of both hardware and computer software, management information systems used in the Old Testament, are in line with the above objectives. That is, they are a real support to the development of statistics to help measure the quality of management being undertaken in each of the areas, as well as compliance with plans and programs and also help all the procedures made be made in the most simple and efficient manner.

3. Procurement of services to the private sector by the AT

Analyzing the different functions of the AT that are likely to be transferred to the private sector of the economy.

The design of the TA and your organization must be related to the economic strategy being pursued in a given country. To the extent that he would give the market a major role in the allocation of resources, be recommended to pierce the private sector, or lean on it, everything that is compatible with the delicate task that has the State Administration of taxes.

The main criteria to consider in the decision whether a task of the TA can be delivered to the private sector are:

The nature of the function. Clearly there are tasks that are delegated, such as the direction of the TA. It does not seem advisable for the tax audit is delegated to the private sector. However, even in this case, we may subcontract part of this audit in private companies, which must be controlled in turn by officials of the TA.

Confidentiality of Tax Information. Given the characteristics of a watchdog that has the AT and the reserve which by law must maintain for the specific information given, should be created to safeguard and control mechanisms in order to avoid violating that principle. This applies both within the AT, as for private companies who perform work for her.

Quality of the function or service. By delegating a role in private sector companies, it is imperative that at least ensures that the quality of that service does not deteriorate.

Economic Considerations. It will be necessary to evaluate what it costs to perform a certain task to the TA, considering the investments and running costs and compare it with what it would be hiring in the private sector.

Facilities Management. Often the legal rules that are subject to AT-both in terms of human resource management and expenditure-is much more rigid than that involving the private sector.

Impact on Global Management. You may want to delegate some tasks or functions in the private sector as a way to download to senior management of the TA have to worry about them.

Political Considerations - Election. In some situations there may be some political pressure on officials to be inhibited AT fulfill their duties by electoral considerations. That could disappear by delivering these tasks to the private sector.

Ethical Considerations of Control. Many tasks to be performed by the TA are delicate, some officials may abuse their authority or be dishonest, which could also happen in the private sector. Accordingly, when analyzing the desirability of privatizing a task, we should consider its impact on this sensitive issue.

The culture of the country. Besides the above, factors such as the idiosyncrasies of the population of a country and its public opinion, may hamper the privatization of certain tasks or functions of the TA. However, if there are good arguments, it can be changed.

The services generally are suitable for transfer to the private sector, contracted by the at, are among others the following:

1. Printing out the necessary forms for the Declaration of taxes.
2. Distribution of these same forms. This includes transportation as well as their distribution among taxpayers across the country, these forms may even be sold through newspaper vendors.
3. Raising taxes through the banking system. Banks may also, along with raising the money for taxes, collect the forms themselves such, and even those who do not mind receiving a monetary payment.
4. Scale in the forms for tax returns. This may make the fingering the bank receiving the forms, or the AT may receive these forms and send them to type specialized private companies.
5. You can also outsource the private sector, computer hardware leasing or hiring computational time in the service mode, the computer processes run on the AT. It also may subcontract the development of computer software.
6. Collection of tax debts. This is that the TA contracted outside attorneys to expedite the collection of delinquent taxes, or may tender the delinquent tax debtors portfolio, shifting this way also their collection to the private sector.
7. The TA have need to communicate with taxpayers in writing, either legally notified of any due diligence they perform or some sanctions that they are exposed, or only know information they need for their performance as taxpayers. For this work, the TA may be based on domestic mail in private mail or outside companies that perform these functions.
8. In terms of staff resources requiring AT, some of them can be obtained through fee contracts that allow people to incorporate hourly or shorter periods for specific tasks to support the work of officials AT properly so.
9. The TA will also subcontract part of the work of personnel selection, necessary for incorporation into the plan of the Old Testament, among which are the psychological reports on applicants.
10. The training tasks can also be contracted with the private sector in partial signature using either the AT external teachers or by sending it to train staff to courses that impart the various universities or institutes.
11. Within the service functions that are performed within the AT, you can subcontract to the private sector, at least in part, all that is transport, either, taxis or renting cars, using the collective resources mobilization . Also be outsourced to external companies sanitation services for the premises of the TA.

To make this work as subcontractors to the private sector carried on successfully, you must be very careful in deciding how the contract itself to the respective tasks. Will have to be open and transparent tendering procedures, to assure that all companies would be eligible to perform these activities for the TA and so are satisfied with the work being done in the most efficient, least-cost and timely brief as possible. It also must lead to allocate contracts in different companies to reduce risks of default and eliminate the possibility of dependency of the TA.

One of the tasks that must necessarily assume the AT is the systematic and comprehensive quality and timeliness of work outsourced to the private sector.

Finally, it is necessary for AT streamline its administrative procedures to make timely payments for services made by the private sector, because if it is too bureaucratic and time-consuming, the private sector will not be interested in to do work for the TA, or charged excessive amounts for realizing them.

4. Civilian career in the TA

In this section we refer to the components of a civilian career staff at the AT. Selection policies, wages, training, qualifications, promotion and tenure and dismissal policy, must be intimately related to the strategic plan and policies that the AT you want to perform.

The selection policy should be based on competitions so they can join the TA staff have professional training and knowledge necessary for optimal charges which must be performed. It should also examine the psychological profile of applicants, so as to measure their potential to work in teams and individually, since in many cases the psychological characteristics interfere with good performance of officials, especially emphasis should be used to try to know the ethical values of the TA staff, as these will be exposed to many temptations because of the sensitive nature of their duties. For those officials who will occupy positions of authority, it is important to know their abilities and personal characteristics that enable them to exercise a leadership role as they need to perform managerial work. Often, in our AT, a variable that unfortunately is considered for the incorporation of staff to it is the policy variable, ie the extent to which officials are close politically to the party in government. Obviously, this kind of feature should not be considered for admission by staff at the AT, since by the nature of their duties, their job should be highly technical.

It should also be defined very precisely the remuneration policy for staff of the TA. This policy will have to consider among other things, the relationship with the private sector and should not be much difference with it. Otherwise, it will attract or will not remain in the TA the best elements that are necessary for doing such a complex and important. The remuneration should also be low in comparison with the minimum requirements for staff at the AT, that this item would be put forward as justification, in some cases to explain or be permissive in the absence of ethical conduct that may have the officials of the AT . The remuneration policy should also consider the pension and health aspects.

The training policy of the TA is one of the keys to their proper functioning, as explained in Section 5.

Another very important part of human resources policy of the TA is its grading policy. We must have a formal body that at least once a year, you tell each one of the officials in what he is doing well, what you're doing wrong and what must be corrected. This should be done according to a regulated procedure for the entire AT and implemented the head of each officer, with review of the leaders of each official, the senior leadership review.

The same qualification must be communicated to the officer by his own boss, giving possibility to ask questions or even to disagree with arguments that the classification has been granted. These qualifications must be relevant to the career civil servant, in the sense that those who are best qualified will have a better chance of promotion to senior positions and improve their earnings.

You should also very carefully considered policy of promotions and appointments of officials of the TA. As vacancies as they occur in general will need to provide officials already in the TA, based on a contest of background, or based on examinations or tests to ensure that these vacancies will be filled by top officials appropriate that they are there. It should consider the grades and other records of staff performance, rather than relying only on seniority, as unfortunately happens in many AT.

Another antecedent to consider is the training completed and approved courses. Given the specialized work of officials of the AT, it is recommended that in general, promotions are internal staff, unless there are not people the right people to hold a position. This, besides the best way to fill in vacancies, thereby benefiting the TA will produce a strong incentive for its own officials because they will see that the extent of that endeavor, they will be able to go forth accessing charges of greater responsibility, which will result in better pay.

The TA will also have a layoff policy that allows the effective and without further ado, let go of those officials that reasonable suspicion exists, not acting ethically. There must also be an expeditious procedure for officers to fire more inefficient and more contentious, or that are not working with the rest of his teammates or the work of the TA.

Obviously, in order to make these redundancies that are dynamic, there must be compensation policy as it exists in general in the private sector. The rules of many AT, making it virtually impossible to fire officials, directly undermines the efficiency of the work of this administration itself, preventing him from getting rid of bad elements.

This, apart from the direct damage they cause, a very negative influence on the morale of other good servants of the TA.