United Nations Public Service Awards Case Studies

The Portuguese tax authorities had already achieved a high capacity to make effective the rights of the State, especially when taxpayers fail to meet their tax obligations. The high investments in new technologies and the broadening of its use in tax procedures, as well as the rapid adaptation of human resources to its use, as an essential instrument of work, allowed an undeniable growth of DGCI’s effectiveness in combating tax evasion, fraud and failure to comply, in terms of taxation.

However, the effectiveness of a modern and demanding tax administration cannot be measured only by its ability to make effective the rights of the State. It also requires effectiveness and rigor in quick and timeously recognition of taxpayers' rights. A strict tax administration ensures the effectiveness of the creditor's tax rights when taxpayers don't want or cannot comply with, but also ensures the effectiveness of the rights of taxpayers and empowers security and predictability to economic traffic. The efficiency of tax administration in the execution of procedures for the enforcement of the tax creditor’s rights cannot coexist with the entrainment of the pendency of the procedures that depend on it, intended to recognize and give effect to the rights of taxpayers. An advanced tax administration, open, transparent and in good faith, helps citizens and businesses, do not demotivates investment, and promotes the efficiency of the economy. In a context of international competitiveness of European economies and of globalization, the efficiency of tax administrations is systematically referenced as one of the most important determinants of investment decisions.

The improvement of service to the taxpayer thus constitutes the essential element of the strategy to improve DGCI’s overall performance, in the future. We achieved the sought after relationship of trust between complying taxpayers and tax administration. Our plan is to make DGCI serve abiding taxpayers, increasing their mutual interaction and ensuring high levels of aid, quality, efficiency, speed and even excellence in service.

Project’s objectives: increase the speed of response to taxpayer’s requests: i) enquiries – tend to reply immediately; ii) Recognition or exercise of rights – Aim for an average period of response of 1 month in simpler administrative review procedures and 3 months in the other. In cases of increased complexity, average periods of 6 months should not be exceeded. Support the fulfillment of obligations (meet the taxpayers) – Provide taxpayers with a set of support services for voluntary compliance, with a propensity to comprise all tax obligations. Multiply the communication channels – Expand the channels of communication with taxpayers, developing the use of Internet and telephone, alongside face-to-face service. Dematerialize procedures and communications – implement the electronic document, notification and electronic citation at DGCI and dematerialize the internal processes within the Tax Administration. Eliminate the systems in use’s inefficiencies – retrieve past buildups, in order to concentrate resources on the immediate assessment of new procedures and synchronize the way the systems function, minimizing errors.

What is the initiative about? (the solution)
The implementation of the Plan began in mid - 2009 and the results and benefits presented below are from the year 2010. Results already achieved: debt and no debt certificates issued through the Internet – Service available since March, 132,423 certificates were issued. Tax settlement certificates – 440,481 certificates were given out over the internet. Duplicates of notices – there were released on the Internet about 7 million notifications. Warnings by email and SMS – The DGCI sends alerts by email and SMS, to all taxpayers that authorized the service, prior to the expiration of deadlines, avoiding added costs with fines and interests. The DGCI also informs taxpayers who may exercise the right to exemption from IMI (Real Estate Tax) for a permanent place of abode. Nearly 12 million email messages and 295,025 SMS were sent. Twitter – informational service of DGCI on Twitter. All through 2010 messages of support to taxpayers were placed regularly. Document and electronic notifications – DGCI’s communications (electronic notifications and quotes) were dematerialized. Over 100,000 taxpayers adhered to this service. 48,400 electronic notifications were sent and over 7 million electronic documents were generated. Integrated management of face-to-face service and all channels of communication – communication channels (face-to-face, telephone and internet) are managed by a management information system of CRM (Customer Relationship Management). Telephone support – a call center composed by 14 regional and 75 local poles was implemented. The number of calls answered doubled (about 320,000 from January to October 2009 and over 640,000 on the same period of 2010). Support via email – The email service was integrated into the CRM system. Informative booklets – The DGCI released leaflets, describing rights and obligations relatively to the following segments of taxpayers: I) that initiate a business activity, ii) those acquiring buildings and receiving inheritances. iii) a brochure about the disclosure of phone number and e-mail information was unveiled as well as IV) another one about our telephone assistance service. Electronic receipts for independent workers (green receipts) - the system for issuing and managing green electronic receipts on the Internet was implemented. Letter of commitment to quality – a poster that binds for a rapid resolution of taxpayer’s requests was publicly displayed on all of DGCI’s services. Repayments “on the hour” – in 2010, IRS (Personal Income Tax) refunds were paid on an average of 15 days after the submission of the tax return, well before the deadline of 5 months. Over 2.1 million taxpayers benefited from this measure and € 1.7 billion were paid. Recovery of backlog of administrative complaint procedures – an exceptional recovery plan was concluded, reducing the balance of procedures from 22,689 to 6,165 and the average time of completion of almost a year for 1 month. Sanitation of pending refunds – concluded the buildup recovery plan. 115,280 personal income tax refunds in delay, 60,607 of IMI (Real Estate Tax) and around 30,000 VAT refunds. DGCI takes now less than 1 month to appreciate these repayments, retrieving a delay of decades. Qualification and consolidation of the information – an extensive plan for elimination of inefficiencies was concluded, by eliminating the factors that generate errors.

Who proposed the solution, who implemented it and who were the stakeholders?
The concern for quality in service to taxpayers is not recent in the DGCI, with examples like the Information Systems Consolidation Plan, the Integrated System of Support to Taxpayers (as well as the development of one of the strands of the latter with the creation of the telephone call center, in 2006) and the continued efforts in the field of professional training, which have been made in recent years. Both those studies and the experience of the call center were valuable contributions for the implemented solution To put the DGCI to the service of abiding taxpayers, increasing the mutual interaction and ensuring high levels of aid, quality, efficiency, speed and even of excellence in the given service was the purpose of the above-mentioned Plan. To be successful, a plan of this nature has to involve the whole DGCI - all its areas and hierarchical levels. This is not a sectorial plan but a comprehensive orientation program for DGCI as a whole in the upcoming years, which will only succeed with the active participation and commitment of all leaders and workers of the DGCI. Its implementation depends directly on the Mr. Director-General of Taxation and was assumed to be the first strategic priority of the DGCI, together with the maintenance of the efficiency levels of voluntary collection, without damaging the maintenance of efficiency levels already achieved, both in the area of tax auditing and enforcement. In this sense, the above-mentioned Strategic Plan, which tries to respond to the longings of both citizens and of the enterprises, was drafted by the dome of the DGCI (Mr. Director-General and Council of the Tax Administration) and received, also, exceptional contributions of some Directors of Finances (District Offices), Directors of Central Departments and Heads of local Services. Its implementation required, of course, the enthusiasm, effort and dedication of the over 10,000 DGCI workers distributed by local, regional and central offices. With regard to IT projects, we always disposed of the essential and useful cooperation of the Directorate-General of Computer Science and Support to the Tax Services and Customs officers (DGITA). The DGCI valued well the context (internal and extern) and felt that this change was necessary and urgent. A work team was created (the designated Mission for Quality in Service to the Taxpayer), orientated for the change, constituted by persons respected within the DGCI, fully committed to the project, with the confidence and emotional commitment required. This team was always with the involvement and commitment of Mr. Director-General of Taxation. The vision is motivating and well-defined (construction of a tax administration next to the citizen and business) and new strategies were disseminated through the most appropriate communication channels (press, internet and intranet). The DGCI bet heavily on the communication with taxpayers and with DGCI’s workforce. The team showed effort, dedication and persistence. It consists of people encouraged and motivated to continue the project. The new practices are crystallized. The DGCI conceived a structure of support able to do things well by the new form.

Describe how and when the initiative was implemented by answering these questions
a. What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
The strategies used: - Subsidiarity: Local offices are the face of DGCI and its interface with taxpayers. Taxpayers should have the confidence that their local office will solve their problems and doubts regarding the day-to-day implementation of tax law, in keeping up with their tax obligations and the monitoring and resolution of pending procedures. Being the local offices the tax administration’s interface with taxpayers, its responsibles (the heads of offices) must possess the necessary skills to respond to the generality of taxpayers’ requests. The principle of subsidiarity has also another aspect, that of territorial continuity of competences. It would be desirable that taxpayers could deal with any topic in any local office, giving all of them universal territorial jurisdiction. - Electronic tax administration: excessive physical movements of taxpayers to the services, is an important factor of inefficiency for the State, not only by the human resources involved in attendance, but also on travel costs for taxpayers. The bet on technology, driven by making available to taxpayers on the Internet functionalities that can be obtained at the local offices and, even more, new relational features, of interoperation and interactive, is one of the most important and profitable DGCI bets. - Interaction with taxpayers: a modern tax administration needs to be much more pro-active, preventive and pedagogic; it should focus on the objective of enhancing, promoting and supporting the voluntary compliance of tax obligations. The tax administration must react systematically and rigorously to breaches of the fulfillment of obligations by taxpayers, but will always have greater legitimacy to do so if previously it exercised the pedagogy, support and promotion of compliance of the same obligations, by providing the taxpayers all the necessary information prior to the deadlines for the fulfillment of those obligations. - The "Tax Ecosystem": DGCI interacts constantly with taxpayers and a set of public and private partners with whom it systematically exchanges information that is essential to both the operation of the system and its own efficiency and effectiveness. The DGCI, taxpayers and these public and private stakeholders are partners and form, together with the law, a "tax ecosystem" that should be thought of globally, so that its operation becomes simple and efficient. DGCI must now focus its concern on making the compliance with tax obligations by taxpayers and its partners as simple and inexpensive as possible, reducing to the minimum compliance costs and associated discomfort. To achieve this it is vital that DGCI adopts a comprehensive strategy for the entire tax system, betting on two key factors of competitiveness and efficiency: - on the one hand, the circulation of information between all agents of the tax cluster, in order to eliminate the need for taxpayers to carry information from one agent to the other; - on the other hand, the integration of systems so that it eliminates information transmission errors that affect the quality of service and always produce litigation between the agents of the system.

b. What were the key development and implementation steps and the chronology? No more than 500 words
The basilar steps were the following: 1.st Elaboration of the Strategic Plan for the Implementation of Taxpayer Quality Service; 2.nd For the implementation of the 7 programs and 38 projects comprised in this strategic plan, a structuring and implementation support model was conceived, ensured by a structure designated Mission for Quality in Service to the Taxpayer (MIQ). The MIQ depends directly on the Mr. Director-General of Taxation and has the following structure: a coordinator/strategic manager, Director of Services, an operating Manager/Coordinator, Head of Division, and two cores (for external quality and internal quality) with their respective coordinators – tax administration technicians; 3.rd In order to implement some projects there were set up, additionally, working groups comprising representatives of the various functional areas of action within the DGCI, DGITA, and other government services (e.g. ITIJ, IGCP, DGO, etc.) and consultants/external service providers. These working groups participate whenever necessary in working meetings convened as necessary by the Mission for Quality in Service to the Taxpayer; 4.th On a regional level, the Plan’s implementation is guided by a correspondent named by the Head of the Regional Office, and directly depending on the latter; 5.th The Plan’s implementation’s supervision is managed through weekly meetings between Mr. Director-General and the strategic and operating managers, and between these and the core coordinators; 6.th The IT systems to develop/implement were identified; and 7.th At last, a training strategy and a specific financial plan were drafted, and the deadlines for the projects/programs implementation were established. The Plan for the Implementation of Taxpayer Quality Service was approved by a dispatch issued by His Excellency the Secretary of State of Tax Affairs, dated December 23rd, 2008. On March 13th, 2009, the Mission for Quality in Service to the Taxpayer (MIQ) was created, a temporary organic unit of DGCI, on a direct tutelage from the Director-General, to promote the Plan’s implementation. On April 2009, the works within the electronic document and notifications were initiated, in a workgroup that included DGITA and the Portuguese Post Office (as a certifying entity), that ensure the integrity and the confidentiality of documents sent to the electronic postal box, through the service ViaCTT. In the same month, works regarding the computerization and dematerialization of all the proceedings (using the filenet technology) begun, as well as the works concerning the development of a telephone call center structure within the DGCI, which made the interaction between taxpayers and DGCI easier, in matters such as the interpretation of tax law, filling of tax returns and accompanying procedures. On July 2009, the “Personalized Interactive Agenda” project works were initiated, and on October the same happened with the workings regarding “Twitter”. On November 2009, non-mandatory information and support to voluntary compliance communications begun to be sent by email and sms, and works regarding the issue of debt and non-debt certificates through the internet were initiated. During the next month, the remainder of projects enumerated on the Plan commenced.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
MIQ had to face and overcome several challenges, both internal and external, such as: Taxpayer’s expectations: taxpayers expect and demand services of high quality, clarity, simplicity and performance in relationship, a fair tax administration, that ensures the compliance of all taxpayers and both professionalism and a conduct steered by the highest standards in ethics and deontology. Actuation of courts: the delay in the performance of courts of law harms taxpayers’ guarantees and, to the extent that can lead to the time-barring of tax credits, restraints the activity and performance of the tax administration, and may also be an incentive to litigation. Recruiting talents: the DGCI has encountered difficulties in recruiting new workers, which creates constraints at the level of the rejuvenation of the Organization and its reinforcement with people of high qualifications, necessary to tackle the complexity of legislation and fraud and the high level of knowledge demonstrated by the consultants, auditors, and daily budget experts that are interlocutors of the tax administration. There is an excessive reliance by the DGCI on outsourcing, in the area of new technologies. Buildups: DGCI has the capacity to appreciate and conclude all proceedings started in each year, but needed to solve a passive of backlogs, accumulated in the past. The entrainment of backlogs is in itself impairment for both taxpayers and the State. For taxpayers because they spend several years with its tax situation indefinite and for the State because it cannot collect taxes settled in litigation. It is also damages the competitiveness of the economy, given that, in an environment of intense international competitiveness, the speed in which the States recognize the rights of taxpayers may be decisive for the realization of investments. Being this one a structural problem, with which the DGCI has been dwelling for many years, its resolution was not possible with current resources, so that the response had to be one of a structural nature. An exceptional recovery plan of backlogs in delay was established, with the exceptional allocation of employees to that plan, without prejudice to the exercise of their normal duties, and therefore outside normal working hours. Some projects, such as the management system of procedures and services (GPS), require high investments related to: - the acquisition of a technological infrastructure; - the purchase of scanners in order to proceed to the digitalization of all documents arriving at DGCI; - Increasing the capacity of the IT network, which will have to support an added information traffic, mainly the resulting from the visualization of documents, images to be placed on a central frame and accessed by several users, etc.

d. What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
The Strategic Plan’s execution is assured by a Core and a task-force, created in the direct dependence of the Director-General of Taxation. A Core for the external implementation of the Quality Plan (NEQ) and a Core for the internal application of the same plan. Each core has a coordinator and both depend on an operational manager and a strategic manager. The organic structure composed by the two cores, and by their operational and strategic managers, was named Mission for Quality (MIQ). MIQ operates in coordination with the Directorate-General of Computer Science and Support to the Tax Services and Customs officers (DGITA), that develops the computer procedures necessary to the implementation of the computer systems. Each functional area within the DGCI will designate a representative to be the responsible for the execution of the internal procedures in that area, that are shown to be necessary to the accomplishment of the projects scheduled on the Plan. A high-level specialist bourse, comprising each thematic area and tax, will be created, that, from their workplaces, will provide support to the call center’s secondary row, the analysis of binding information requests and high complexity administrative appeals. There will also be created a nationwide list of trainers destined to provide all the training necessary to the Plan’s implementation. An officials training program will be developed regarding public service and taxation. Training will always be oriented to the provision of services and support to taxpayers. The strategic Plan for Quality in Service to the taxpayer is the responsibility of the Mission for Quality, which develops all the projects in partnership with the Tax administration Directorates and DGITA. However, the Plan involves the entire organization, particularly the implementation of the Customer Relationship Management system (CRM) and the management system of procedures and services (Filenet) involving all human resources of DGCI (about 10 000 employees). The strategies and projects’ implementation comprises the development of a series of IT systems, such as: - Electronic signature management system; - Electronic local office; - Interactive Electronic Agenda - Tax benefits integrated system of control (SICBEF) - On-line assessment and reimbursement system; - On line receipts and invoices management and emission system; - Knowledge database management system. The funding concerning the Plan’s implementation, in the matter of the development of IT systems as well as internal responsibility projects execution, is subordinated to DGCI and DGITA’s regular budget. The financial investment, that is responsibility of the DGCI, amounts to some EUR 8 million and concerns the acquisition of licenses FileNet and Siebel / CRM, as well as multifunctional. Not included is the cost of staff training. The costs with professional training are supported by the current model of financing, as well as through QREN revenues and, eventually, DGCI’s own profits.

Is the initiative sustainable and transferable?
DGCI intend to become, for the entire country, a reference of a modern State’s relationship with its citizens and become one of the more advanced tax administrations in the European Union. For that, DGCI conceived and is finalizing the implementation of the Plan for Quality in Service to the Taxpayer, designed to improve the quality of service to taxpayers, placing them in the center of the system. On recent times, DGCI reached a high capacity to make effective the rights of the State, particularly when taxpayers fail to meet their tax obligations. The generalization of the use of new technologies in tax procedures, the bet on the qualification of human resources and their rapid adjustment to the use of those technologies, as an essential instrument of work, allowed and unceasing growth of DGCI’s effectiveness in combating tax evasion, fraud and failure, in what taxation is concerned. Reached the above mentioned level of efficiency and effectiveness, DGCI has now as strategic priority to increase significantly the quality of service it provides to taxpayers. Within the Plan, DGCI will dematerialize all internal procedures, eliminate paper as the support of all processes, dematerialize the communications with taxpayers (in both directions) and leverage mutual interaction, customization and the integration of communication channels. On a context of international competitiveness, the efficiency of tax administrations constitutes one of the most important factors influencing investment decisions.

What are the impact of your initiative and the lessons learned?
Taxpayers are required to submit several communications on a dematerialized manner through the internet. However, that requirement is not reciprocate. The implementation of the electronic document will allow the dematerialization of communications to taxpayers, as well as the dematerialization of the services’ internal work and the interoperability with other Portuguese public administration departments, removing the bureaucracy from services and relations with taxpayers, at the same time that simplifies the fulfillment of tax obligations. The telephone channel is another important feature that DGCI is being developing, in order to reduce substantially the volume of face-to-face service, and also the volume of casuistic phone calls and spread throughout the services. This year, DGCI improved its Call Center structure (707 206 707), operating in a network throughout the country, eliminating the constraints of the previous telephone support service that lacked acceptable service capacity to reply to all calls. A strategy of decentralization of telephone calls’ attendance followed, with the creation of regional call centers (in most regional offices), to tackle the significant increase of telephone calls that occur during the months prior to the personal income tax return filing deadline. Up until then, there was a single Call Center, located in Lisbon, that has become the central structure of a service network that works simultaneously and in coordination with 75 local offices and 14 regional offices. This measure required the acquisition and installation of the necessary equipment as well as the proper training of over 200 workers, in telephone assistance. In face of the good results achieved, that will be referenced later on, we will reinforce that call center structure during the current year, with another 100 work posts in local offices, and have already initiated the involved workers’ training. The referred measures have already produced important results. From January to October 2010 DGCI’s call center has already answered 637,271 phone calls, well beyond the 460,416 answered all through 2009, and is predictable that by the end of 2010 a growth rate that will practically allow to duplicate replied calls will be reached, increasing on an extraordinary manner DGCI’s efficiency in servicing taxpayers. By the diversification of communication channels with taxpayers, DGCI is implementing an integrated management system of all attendance (CRM system – Customer Relationship Management), on an independent manner from the respective channels. This project comprises the development of an integrated attendance policy with resource to new global support technologies – telephone, face-to-face and electronic – through the implementation on a SIEBEL platform of a CRM system linking all channels, providing a standardization of information and a monitoring of a listing of all the taxpayer’s interactions with the Tax Administration, regardless of the channel used.


Institution Name:		Portuguese Tax Administration
Institution Type:		Public Agency
Contact Person:		José António Azevedo Pereira
Title:		General Director
Telephone/ Fax:		00 351 218 812 600
Institution's / Project's Website:		00 351 218 812 938
E-mail:		dgci@dgci.min-financas.pt
Address:		Rua da Prata, Nº 10
Postal Code:		1149-027 Lisboa
City:		Lisbon
State/Province:
Country:		Portugal

The Problem

Solution and Key Benefits

Actors and Stakeholders

(a) Strategies

(b) Implementation

(c) Overcoming Obstacles

(d) Use of Resources

Sustainability and Transferability

Lessons Learned

Contact Information