The Promise and Limitations of Information Technology for Tax Mobilisation

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Date
2023-02Author
Scarpini, Celeste
Okunogbe, Oyebola
Santoro, Fabrizio
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Abstract
As digital technologies continue gaining momentum
in Africa and lower-income countries, more and more
tax authorities are adopting them to improve their core
functions and collect revenue more efficiently.
This paper reviews recent literature on using technology
for tax administration. Technology has the potential to
improve tax collection in three areas: identifying the tax
base, monitoring compliance, and facilitating compliance.
But even the most user-friendly technology will hardly
function without basic infrastructure and a stable internet
connection. The potential benefits of new technology
are further hampered by resistance from taxpayers and
collectors, an unsupportive regulatory environment and
lack of strategy for adoption by institutions. We close
by proposing reforms to ensure investments in new
technology improve efficiency and revenue collection. This is a summary of Working Paper 135 by Oyebola Okunogbe and Fabrizio Santoro.