Insights: Advancing the role of tax authorities through technology

Modern technologies that elevate and improve organisations in society are more powerful, and more important, than ever before. Progressive entities, like government, are increasingly understanding and implementing cutting-edge technologies, as a means for them to leverage technological capabilities and add value to citizens and constituents alike.

Tax authorities, in particular, are aggressively adopting artificial intelligence to generate and preserve taxpayer data. This is in effort to fight the high cases of tax evasion, which is experienced in many regions across the globe.

The difficulties faced by tax entities
Tax regulations require that organisations, provide accurate information regarding the details of taxpayers, including their income and tax paid over the years. This also includes other business and economic activity that an entity or an individual may engage in. To guarantee compliance, tax institutions need to look to technology, to simplify, for example, the mechanics of data-sharing across and between organisations, while preserving the veil of privacy.

The challenge in government entities serving as tax authorities, is often that, due to legacy systems, there is a great amount of data that is either lost or in disparate and unstructured locations. As a result, this creates difficulties in keeping tax evaders under surveillance and assessing activities such as taxable income. The lack of data validation and verification will also further impede the development of new fraud models that improve fraud detection efficiency.

Improving business operations and performance
Implementing powerful technological tools in tax entities, presents an opportunity for departments to focus less on mundane administrations, and more on the value-added activities that increase work satisfaction.

Without technology, and as experienced in some government organisations today, majority of employers spend time on manual data collection, analysis and reports – couple this with outdated systems, and tax teams are left feeling frustrated and disempowered.

Adopting technology into tax operation, will not only enable government employers to collect and preserve data; it also enables them to gather key insights and identify critical trends. Doing so is critical, as tax entities make their decisions based off data. Essentially, the level of data analysis and insight, can overall transform tax operations and help government build even more efficient tax structures.

Empowering tax entities for years to come
Transforming an organisation that is entrenched in legacy manual tasks and systems, into a high-performing and technologically empowered tax entity, requires a strategic and phased approach, over time.

Having worked and onboarded tax entities in the implementation of their technology solutions, Lenovo believes the organizations will become more forward thinking, agile and more likely to develop more sustainable frameworks for years to come. The technology company provides the combination of technology and software, to align with a range of data warehouse and transactional database use cases.

Mahomed Ramathulla is the regional sales director at Lenovo Middle East and Africa

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