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DEVELOPING TAX ADMINISTRATION IN THE CONTEXT OF THE
PARTNERSHIP OF PARTICIPANTS OF TAX RELATIONS
Tatyana Aleksandrovna Efremova
National Research Ogarev Mordovia State University, Saransk, (Russia Federation).
E-mail: tatyanaaefremova@yandex.ru ORCID: https://orcid.org/0000-0002-8476-3632
Recepción:
22/04/2020
Aceptación:
01/06/2020
Publicación:
24/08/2020
Citación sugerida:
Efremova, T.A. (2020). Developing tax administration in the context of the partnership of participants of tax relations.
3C Empresa. Investigación y pensamiento crítico, 9(3), 109-123. https://doi.org/10.17993/3cemp.2020.090343.109-123
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ABSTRACT
The aim of the study is to elaborate methodological and practical recommendations to develop tax
administration when forming tax relations based on the partnership, trust and mutual responsibility of
tax authorities and taxpayers. The author uses general and special methods of scientic knowledge (the
abstract-logical method, methods of analysis and synthesis, comparison and generalization, etc.) as a
methodological base, which makes it possible to justify the need to change the form of the cooperation
between the state (represented by tax authorities) and taxpayers, to assess the satisfaction of physical and
legal entities with the quality of service in tax oces, and to elaborate a set of recommendations aimed
at harmonizing the interests of the participants of tax relations. Results indicate that the transition to a
socio-technological model for developing the tax service of Russia implies a refusal to serve taxpayers
according to the formula “Long. Dicult. Inconvenient” in favor of the formula “Quick. Easy.
Convenient. Professional”. At the same time, modern information technologies and tax administration
management systems are becoming a tool that ensures the development of the relationship between tax
authorities and citizens and businesses. Their application allows the formation of informational and
methodological support for taxpayers, which stimulates the voluntary fulllment of tax obligations, and
improves the quality of services oered to them by tax authorities. It can be concluded that forming tax
relations based on the partnership of their participants helps to achieve positive results in developing tax
administration.
KEYWORDS
Tax Administration, Tax Relations, Partnership, Taxpayers, Tax authorities, Tax oces.
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1. INTRODUCTION
The stability and suciency of the receipt of nancial resources in the state budget, and consequently
its economic and social development, are largely determined by the quality and eectiveness of tax
administration. In this case, the conditions to improve scal performance are both the reduction of the
possibility of tax evasion and the stimulation of taxpayers to pay their taxes voluntarily. This makes
it necessary to change the power-dominated form of the cooperation between the participants of tax
relations into partnership, which is based on creating a system-based customer-oriented approach
to arranging the work of tax authorities with physical and legal entities. At the same time, the main
emphasis is on forming a comfortable tax environment for taxpayers that simplies the fulllment of
their tax obligations.
Nowadays the solution to this problem in Russia is possible, thanks largely to the introduction of
information technologies in the tax sphere, which allows the more active involvement of taxpayers in
the cooperation with tax authorities while they fulll their tax obligations and implement the exchange
of information. Therefore, further improving information and telecommunication technologies and
developing electronic services are a priority for tax authorities. This makes it possible to form such
information and methodological support for taxpayers that will nullify many tax violations and ensure
the growth of the voluntary payment of taxes to the budget system of the country.
2. LITERATURE REVIEW
The problem of developing tax administration is one of the key issues in modern economic science.
However, in Russia, the nature and content of tax administration and its arrangement began to be studied
only in the rst decade of the 2000s after the use of this term in a number of regulatory documents
of federal executive bodies. Russian economists such as Aristarkhova et al. (2016), Aronov and Kashin
(2006), Goncharenko (2009), Krasnitsky (2011), Mayburov (2007), Melnikova (2005), Mironova and
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Hanafeyev (2005), Mishustin (2010), Ospanov et al. (1997) have devoted their works to the study of tax
administration.
Certain issues concerning the improvement of relations between the state and taxpayers were reected
in writings of such foreign scientists as Clemenza et al. (2010), Hauptman et al. (2014), and also in works
of Russian researchers, Gashenko (2009), Peronko (2000) and others.
At the same time, if in most developed Western countries (the USA, UK, Switzerland, the Netherlands,
Denmark, etc.) tax administration has long been based on a partnership model using a customer-oriented
approach, mutual trust and mutually benecial “exchange” of the managed with the managed, then in
Russia the need to change the current system of tax relations is only being realized.
The priority in the work of the tax service is to create a systematic, client-oriented approach to arranging
the work with physical and legal entities. The specics of its forming and arranging was reected in
works of Walsh (2012), Demin (2016), Orlova (2013), Ponomarev and Ponomareva (2012) and others.
Thereafter, the implementation of the ideology of creating the most comfortable tax administration
procedures for bona de taxpayers was developed in the Strategic Map of the Federal Tax Service
of Russia for the period of 2017-2021 (Strategic map of the Federal Tax Service of Russia for the
period of 2017-2021), identifying such priority areas as reducing the administrative burden on taxpayers,
simplifying the execution of tax procedures, and developing an open dialogue with business and society.
3. METHODS
The principles of a systematic approach to the study of tax relations were used, rst of all, as a
methodological base of the study, which made it possible to identify essential characteristics of the
phenomena and processes under study, to determine their development trends, and to identify causes
of contradictions between them. In addition, general and special methods of scientic knowledge
were used in the course of the work: the abstract-logical method, methods of analysis and synthesis,
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comparison and generalization, system and structural analysis, economic and mathematical methods.
As a whole, these research methods ensured the reliability of the economic analysis and the validity of
the conclusions made.
4. RESULTS
Currently, Russia is undergoing a large-scale tax reform aimed at developing tax administration,
bringing it nearer to the best international practices. The main attention is paid to improving relations
and developing ties between the state, represented by tax authorities, and citizens, and businesses.
This problem can be solved by forming new approaches to tax administration based on the use of modern
information technologies and management systems. The transition to a structural and technological
foundation to form a globally competitive tax administration system, and to develop activities of tax
authorities, taking into account the increase of opportunities to apply basic principles in the eld of
social skills, have determined the possibility of forming relations between tax authorities and taxpayers
based on mutual trust, partnership and customer-oriented services.
To that end, in 2011, the Federal Tax Service of Russia adopted the concept of working with taxpayers,
which determined an action strategy for the near future (The concept of working with taxpayers). It
proposes a transition from a technological model for developing the Federal Tax Service of Russia
to a socio-technological model, from serving taxpayers according to the formula “Long. Dicult.
Inconvenient” to the formula “Quick. Easy. Convenient. Professional”.
The concept of the Federal Tax Service of Russia to work with taxpayers aims to increase the level of
fullling tax obligations by taxpayers, and to improve the image of the Federal Tax Service of Russia by
developing an understandable, convenient, and economically viable tax administration while providing
state services and serving taxpayers.
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State tax services are services provided by tax authorities to carry out activities aimed at securing rights,
freedom, and protection of interests of physical and legal entities, including providing registration,
information, and interactive services using information technologies (Efremova & Efremova, 2015;
Aberbach & Christensen, 2007; Besfamille & Siritto, 2009; Mansor & Tayib, 2013).
The implementation of state tax services serves to simplify procedures to execute tax obligations by
taxpayers. That is, the tax authority should be transformed from a scal structure into a service that
focuses on the taxpayer’s interests.
The social orientation of developing the tax service is aimed at changing the architecture and technological
platform of the department, taking into account a client-oriented renement, which should provide a
technological foundation that generates convenient services and opportunities for high-quality service to
taxpayers.
To do this, non-contact forms of cooperation with taxpayers based on new information technologies are
being developed. So, to get many services, taxpayers only need to use the tax service website, which hosts
a variety of interactive services, thanks to which they can nd out the address and opening hours of the
local tax oce, make an appointment, nd any necessary information to calculate taxes and to pay them,
check their counterparties, have a look at the Unied State Register of Legal Entities and the Unied
State Register of Enterprises, and register as a legal entity or individual entrepreneur.
The quality of the work of tax authorities in their interface with taxpayers depends on how the services
oered to the latter correspond to their needs and requests. It can be characterized using indicators
such as the number of citizens and organizations getting information from the Unied State Register
of Legal Entities and the Unied State Register of Industrial Enterprises with the help of internet
technologies; the proportion of taxpayers having access through communication channels and Internet
to personalized information on the status of budget settlements; the eciency of considering incoming
requests; and the share of taxpayers reporting by telecommunication channels.
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However, by no means all of these indicators have quantication. In addition, there is no generally
accepted methodology to assess the quality of the services of tax authorities. In this regard, we can use
the methodology proposed by Zhukova (2008), which is based on the taxpayer satisfaction index that
shows how services oered by tax authorities comply with his/her requirements and wishes. However,
we consider it necessary to exclude the absolute value of the taxpayer satisfaction index, and to use the
ratio of the calculated index value to its maximum possible value.
Then, the formula for the quality index of services oered by tax authorities to taxpayers will look like
this:
(1)
Where:
F
i
is the level of fullling the i-th taxpayer satisfaction criterion;
I
i
is the level of importance of the i-th satisfaction criterion for the taxpayer;
n is the number of satisfaction criteria.
We have selected the following satisfaction criteria:
• The rate of serving taxpayers.
• The competence, courtesy, and correctness of tax inspectors.
• The convenience of the tax authorities’ website.
• The ease and availability of internet services oered by tax authorities.
• The eciency of considering incoming requests.
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We consider the optimal rating scale to be from 1 to 5, both for the level of fullling the criterion and its
importance for the taxpayer.
In assessing the quality of services oered by tax authorities to taxpayers, it is necessary to consider the
opinion of several respondents. Thus, it is advisable to use a modied formula for the quality index of
the work of tax authorities with taxpayers:
(2)
Where: R
i
is the level of fullling the rate of serving taxpayers;
C
i
is the level of fullling the competence, courtesy and correctness of tax inspectors;
Cint
i
is the level of fullling the convenience of the tax authorities’ website;
Aint
i
is the level of fullling the availability of internet services oered by tax authorities;
E
i
is the level of fullling the eciency of considering requests from taxpayers received by tax
authorities;
α is the number of people who preferred the i-th level of satisfaction with the criterion under
consideration at the i-th level of its importance;
β is the number of people participating in the survey; and 125 is the maximum value of fullling all
considered criteria of the taxpayer satisfaction with the maximum level of importance.
Using the proposed methodology, we conducted a survey of taxpayers, in which 87 respondents took
part. Moreover, their opinion on the problem under study was divided as follows (Table 1).
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Table 1. The matrix of distributing respondents’ answers according to the level of fullling criteria of the satisfaction with the quality
of the work of tax authorities in accordance with their importance, people
Criteria
importance
level
level of fullling
very
important
important
rather
important
than
unimportant
of little
importance
unimportant
5 4 3 2 1
rate of serving
taxpayers
very high 5 13 7
high 4 21 11
acceptable 3 10 7
low 2 8 5 1
very low 1 3 1
competence,
courtesy and
correctness of tax
inspectors
very high 5 9 15
high 4 13 19 1
acceptable 3 7 11 1
low 2 4 5 1
very low 1 1
convenience
of the tax
authorities’
website
very high 5 5 10
high 4 10 19 9
acceptable 3 7 14 10
low 2 1 1 1
very low 1
ease and
availability
of Internet
services
offered by tax
authorities
very high 5 6 15
high 4 7 25 11 1
acceptable 3 5 13 1
low 2 1 1 1
very low 1
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Criteria
importance
level
level of fullling
very
important
important
rather
important
than
unimportant
of little
importance
unimportant
5 4 3 2 1
efciency of
considering
incoming
requests
very high 5 9 2
high 4 20 4
acceptable 3 34 3
low 2 9 2
very low 1 4
Using the survey results, we calculated the resulting index, amounted to 64.2%, which indicated an
acceptable level of fullling all the criteria, and at the same time the need for further development of
the cooperation between tax authorities and taxpayers in order to better satisfy interests of the latter
(Efremova & Efremova, 2016; Efremova, 2017).
5. DISCUSSION
Forming relations between tax authorities and taxpayers, based on partnership and customer-oriented
service, contributes to the growth of mutual trust and respect. In this regard, we have dened a set of
measures aimed at bringing together interests of participants of tax relations:
Firstly, developing customer-oriented communications, improving tax culture and the motivation of
taxpayers. So, when developing information materials, it is necessary to consider needs of individual
target groups of taxpayers, as well as to use dierent channels for their promotion. It is necessary to hold
activities aimed at improving tax and legal literacy, tax culture and the motivation of taxpayers through
informing, assisting in registration actions, developing tax competencies taking into account specics,
needs and capabilities of taxpayers. In order for information materials and the form of their submission
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to be available and useful for taxpayers of dierent educational levels, specialists in the eld of marketing
and communication theory should be involved in working on them together with tax professionals.
Secondly, developing the business culture of the Federal Tax Service of Russia, which ensures improving
the quality of serving taxpayers by increasing communicative and professional competencies of tax
inspectors.
Thirdly, developing an external environment that helps taxpayers fulll their tax obligations. Structures
capable of assisting taxpayers in fullling their tax obligations, including tax consultants, auditors,
professional associations, chambers of commerce, business unions, etc., should be involved in a single
value system. The purpose of this trend is to create a stable tax environment to support the mass
taxpayer in fullling his/her tax obligations, to improve the cooperation and integration of eorts of
tax authorities and external structures to serve taxpayers, as well as to create a positive attitude of the
population and organizations to the tax system and activities of the Federal Tax Service of Russia.
Fourthly, ensuring the extraterritoriality of the taxpayer in relation to tax authorities. Extraterritoriality
is the freedom of the taxpayer to gain access to information and services, regardless of a registration and
location. The trend involves a set of structural and functional measures to break the current taxpayer
connection with a registration and location, as well as to provide remote services to taxpayers by
specialized structures that perform functions of mass data processing, as well as telephone and internet
informing.
Fifthly, creating a comfortable taxpayer service area, including: increasing working time of tax oces;
introducing unied time standards (waiting time for a response to a phone call, performing certain
technological procedures); installing payment terminals in tax oces for the convenience of taxpayers to
pay stamp duties; equipping customer oors and other areas to serve customers with computers specially
designated for taxpayers connected to public tax and regulatory information; equipping customer
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oors and other areas to serve customers with related services (pharmacy, drink and snack machines,
photocopying, etc.).
6. CONCLUSION
Thus, developing tax administration largely depends on the cooperation between participants of tax
relations. At the same time, building a system customer-oriented approach of tax authorities to arranging
the work with physical and legal entities based on the combination of principles of partnership and
mutual responsibility is one of conditions for stable functioning of the tax system and state economy.
Tax administration, based on the partnership of participants of tax relations, serves to help achieve the
following positive results in its development:
• Improving scal performance;
• Reducing administrative barriers;
• Improving the transparency of the Federal Tax Service of Russia, ensuring the availability of state
services provided by the department;
• Raising the awareness of taxpayers about activities of the Federal Tax Service of Russia and
services oered, improving the motivation of taxpayers to fulll their tax obligations, enhancing
people’s trust in state authorities and improving the quality of state administrative bodies’ activities;
• Developing the business culture of the Federal Tax Service of Russia as a client-oriented
organization, motivating employees of the Federal Tax Service of Russia to provide the high
quality of state services and taxpayer serving;
• Involving external organizations in providing support to taxpayers to fulll their tax obligations;
• Ensuring extraterritoriality and standardization of tax procedures, enlarging structures oering
mass services;
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• Qualitative extending of distance cooperation for broad layers of taxpayers while improving the
quality of face-to-face cooperation;
• Building the image of the Federal Tax Service of Russia in the eyes of taxpayers as a service that
ensures an absolute tax collection while respecting interests and needs of taxpayers.
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