United Nations Public Service Awards Case Studies

Taxpayers do not have a choice about paying taxes and not many would voluntarily do so if given a choice. However, the Inland Revenue Authority of Singapore (IRAS) believes that voluntary compliance is the only sustainable long-term strategy for an efficient and cost-effective tax administration. It is therefore critical that we make it simple and convenient for taxpayers to meet their tax obligations.

Filling up an 8-page tax return can be quite daunting for most individual taxpayers. IRAS began to think of the possibility of reducing the number of data fields that taxpayers need to fill in and even better, remove the need for taxpayers to submit a return totally!

Separately, taxpayers who need to stamp their documents have to bring their documents and queue up at the counters to get the stamping done. Is it possible to allow taxpayers to do E-Stamping in the comfort of their homes?

Similarly tourists have to fill in hardcopy GST Refund Claim Forms whenever they make purchases while in Singapore. It is a hassle for the tourists to file these forms and present them to claim GST refunds when they leave Singapore. It was time-consuming to fill in the forms after each purchase made and queue up (at different counters) to claim the GST refunds. Tourists who misplaced these forms would leave Singapore with a negative experience since they would not be able to claim GST.

Over the years, the profile of taxpayers has changed. Taxpayers have become increasingly educated and IT savvy. They expect convenient access to up-to-date and easy-to-understand information that is customised to their needs, so that they can comply with their tax obligations easily.

IRAS has long recognised the importance of harnessing technology innovatively to improve voluntary compliance and deliver excellent service to our taxpayers. It was therefore imperative for IRAS to explore the feasibility of offering a suite of electronic services (e-Services) and a portal for taxpayers so that taxpayers did not have to travel to IRAS, queue up for hardcopy forms and mail the completed forms back to IRAS.

What is the initiative about? (the solution)
IRAS aspires to provide taxpayers with 24/7 e-services to reach out to taxpayers more effectively and reduce operational costs. This led IRAS to develop a suite of e-Services such as E-Filing and No-Filing Service (NFS), delivered via a secured portal – myTax Portal. The e-Services are further complemented by other mobile services to “Check Filing Status” and receive real-time tax updates, reminders and information on latest developments via Twitter. IRAS was also the first in the world to implement an E-Stamping system and a government-owned electronic Tourist Refund Scheme (E-TRS). The suite of e-Services benefited various groups of taxpayers e.g.: a) Individual Taxpayers: In 2010, about 94% E-Filed their returns, reflecting the success of this initiative. Under the NFS, taxpayers need not submit any returns if there are no changes to their income or relief claims. Their income information would have been transmitted to IRAS by their employers under the “Auto-Inclusion Scheme (AIS)”. In 2010, among the taxpayers who were eligible for NFS, 82% did not have to file their returns. Without the NFS and E-Filing, these taxpayers would have to track their income, complete and mail their tax returns to IRAS. Singapore’s Emeritus Senior Minister Mr. Goh Chok Tong said “...it is almost a joy submitting income tax returns!” A taxpayer also found the E-Filing“...a breeze to file taxes ...and it is fantastic to be able to see the [income] amount from employers ...The user interface was easy to navigate and the response time is great!” b) Taxpayers who need to stamp documents: On an average, up to 1,000 taxpayers a day (including those from the law firms, estate agencies, secretariat firms and individuals) can now E-Stamp their documents in the comfort of their home without the need to have them physically stamped at stamping counters or service bureaus. Stamp certificates can be printed immediately after successful payment through internet banking. As subscription and transaction fees were removed, taxpayers save on fees, printing, postage costs and most of all, time. The E-Stamping system was enhanced in 2010 and saw the number of registered users increase from 1,500 in 2010 to 2,500 in this year. c) Tourists: All tourists who make purchases at retailers participating in the E-TRS can now claim their GST as they leave Singapore in just 5 minutes compared to 20 minutes in the past. Before the introduction of E-TRS, tourists had to fill in hardcopy forms at the point of purchase, and present these forms to claim GST as they leave Singapore. More than 10 million tourists visit Singapore each year. E-TRS has made GST claims a seamless process and reduced the hassle for the tourists who now do not have to worry about misplacing their claim forms and can clear this process within a much shorter time. d) All Taxpayers: All taxpayers can access myTaxPortal 24/7 anywhere to view their notices from IRAS and perform a wide range of transactions. The taxpayer need not track and file them separately, thus reducing compliance costs for the taxpayer.

Who proposed the solution, who implemented it and who were the stakeholders?
Bringing taxpayer services to a new level by freeing taxpayers from mandatory requirements and the need for intermediaries or third-parties was a radical change envisioned and driven by IRAS senior management. All key initiatives introduced by IRAS follow our Design & Development Process which ensures that feedback is obtained from the relevant parties and incorporated before launching the initiative. IRAS also has a comprehensive Listening & Learning Framework and has set up various groups such as the Taxpayer Feedback Panel (TFP) and Taxpayer Focus Groups (TFG) to obtain feedback from taxpayers. IRAS also engages professional bodies so as to understand their needs and serve them better. For example, in the process of introducing the E-Stamping system, IRAS held various dialogue sessions with the relevant professional bodies such as the Law Society of Singapore, Institute of Certified Public Accountants of Singapore and Institute of Estate Agents. As the key driver and owner of E-TRS, IRAS consulted other stakeholder agencies including Singapore Customs, the Changi Airport Group and the Singapore Tourism Board and key industry players such as the central refund agencies, major retailers and retail trade associations to gain insights into what parameters needed to be established. IRAS also held dialogues with the central refund agencies, major retailers and retail trade associations, for inputs.

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 key business objectives of implementing e-Services were to enhance taxpayer service, reduce compliance cost of taxpayers and enhance long-term cost effectiveness. To achieve them, we had several strategies: 1. Ensure buy-in from our stakeholders It is critical that our stakeholders are engaged as the success of our e-Services such as the NFS, E-Stamping and E-TRS hinges on their participation. For example, buy-in from professional bodies representing the users for E-Stamping was critical to the success of E-Stamping. A series of dialogue sessions were held to clarify the needs of the users and obtain feedback on the most feasible ways to educate and train users. Prior to roll-out of the E-Stamping system, two major law firms were invited to be pilot users to test the system readiness and provide feedback. 2. Make it easy for taxpayers to comply IRAS believes that ‘no need for service’ is the best service to the taxpayers. Taxpayers under NFS do not have to do anything at all during the tax filing period. The lower the compliance cost for the taxpayers, the more they will comply voluntarily and feel less pain when they pay their taxes. 3. Educate and engage our customers IRAS proactively reaches out to specific taxpayer segments with education programmes to promote the e-Services through measures such as : - Pilot testing; - Media releases on the implementation of the e-Services; - Brochures; - Letters to encourage users to come on board the enhanced system; - Special training seminars on the changes combined with demonstrations and - Training CDs and instructional videos for users.

b. What were the key development and implementation steps and the chronology? No more than 500 words
IRAS Senior Management sets the strategic directions during the Annual Planning Workshops and reviews the projects at various key milestones. Our e-Services were developed over several phases : 1. Obtain feedback from various stakeholders Feedback was solicited from the TFP and during TFGs sessions, from intermediaries, retailers and professional bodies that IRAS collaborates with, as well as from staff suggestions. 2. Prepare Design Requirements Cross-functional teams comprising staff from various Divisions were set up to work with the different stakeholders to: - gather inputs and assess the feasibility of implementing the initiatives; - prepare design requirements and make the necessary legislative changes; - review whether legislative changes were necessary; - propose the new business model; and - draft communication plans and training materials. 3. System Development and Pilot Testing Owing to the complexity of the initiatives, rigorous testing and verification was carried out by the project teams with vendors and our Infocomm Division together with end-users from the various Divisions. 4. Implementation Detailed communication plans covering training seminars, media releases, letters and circulars to stakeholders, brochures and website content as well as contingency plans in the event of system failure were put up for the system launch. The number of officers to handle hotlines was also increased in anticipation for an influx of telephone queries. 5. Post implementation review A detailed post implementation review was conducted after the 1st year of implementation of each initiative. For example, each year, we study the feedback from taxpayers on the E-Filing system and improve the filing experience for our individual taxpayers.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
The main obstacles we encountered in the development and delivery of our e-Services were: 1. Constraints in current system Project teams had to modify the existing system to cater to different target groups of taxpayers during the pilot testing phases and the roll-out phases. 2. Communications and Commitment Meeting development deadlines needed staff commitment and good communication. Updates and information on project milestones were frequently pushed out to staff and regular sharing/briefing sessions were held to ensure that users would be committed and be prepared for the system launch. 3. Changing taxpayers’ and stakeholders’ mindset Given that we were driving radical shifts in the behaviour of taxpayers and stakeholders, comprehensive publicity programmes needed to be rolled-out in phases to engage, consult with and re-assure them. For example, some taxpayers who received our letter informing them about their NFS eligibility called up to confirm that they do not have to file any tax return. Some of the other measures that IRAS put in place to manage the change include letters educating our taxpayers and stakeholders of upcoming changes, seminars, system demonstrations and increasing the number of helpline officers and set-up of e-mail boxes.

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
Through effective planning we maximised our human and financial resources to implement our e-services. 1. Human Resources The implementation efforts were led by our senior management who regularly generate ideas for improvements at management and project meetings. While the development of resource-intensive projects such as E-TRS was awarded to external vendor, the NFS only required system modifications to identify eligible taxpayers and issue NFS letters. Staff from our Infocomm Division worked closely with operations Divisions and vendors for the implementation of the projects. Staff from the various operations Divisions were deployed to be members of the cross-functional teams to undertake feasibility studies of the projects and develop the solutions. For NFS, staff from Law and Corporate Development Divisions were deployed to effect legislative changes and prepare additional publicity to raise awareness, while extra staff were deployed to man the dedicated help lines and e-mail boxes to cater to NFS enquiries. IRAS has a strong innovation culture where staff proactively surface ideas to make improvements to systems and processes. Divisions also brainstorm for ideas to improve service delivery and work efficiency as part of their divisional planning process. 2. Financial Resources The financial costs vary across the different e-Services projects as some required the services of external vendors and a longer implementation time. The system modifications for the NFS cost about $80,000 whereas other e-services cost much more e.g. E-TRS cost $18 million (i.e. about $1.50 per tourist).

Is the initiative sustainable and transferable?
Our e-Services are both sustainable and transferable. By leveraging on current technology and by careful segmentation of our taxpayers, we are able to enhance our e-Services so that they match our taxpayers’ needs and remain relevant and sustainable in the long term. By making it simple and convenient for taxpayers to meet their tax obligations, we are able partner our taxpayers. Currently, employers with 30 or more employees are required to participate in the AIS. Efforts to promote auto-inclusion of income and expansion of NFS, have benefited nearly 80 per cent of employees and the NFS base has since grown 17-fold in four years, to 787,000 taxpayers in 2011. With increasing numbers of employers participating under AIS and eligible taxpayers under NFS, both the NFS and AIS continue to grow and are highly sustainable. The majority of taxpayers are compliant. While they do not have a choice about paying taxes, we want to make taxpaying as easy and as convenient as possible. We do so by anticipating and understanding their needs, simplifying the tax system and processes, giving them easy access to timely information, and providing clarity and certainty. We also detect non-compliance and take strong deterrent measures against errant taxpayers. This ensures that Singapore has a fair and sustainable tax system where every taxpayer contributes his fair share of tax. IRAS was the first in the world to deploy the E-Stamping system via intermediaries in 1999. Our counterparts in Hong Kong, India, Malaysia and Ireland visited us to gain insights when they were exploring implementing a similar system for intermediaries. The enhanced direct E-Stamping will similarly be a model for others to follow. Since the enhancements in 2010, we have hosted learning visits for our counterparts from Western Australia and Korea. We have been invited to share the best practices and lessons learnt in implementing our e-Services with our regional and international counterparts as well as several non-tax related agencies. A few examples are listed below: - Singapore’s National Healthcare Group - Representatives from the various ministries and statutory boards in Singapore - 38th Study Group of Asian Tax Administration and Research Meeting in Nov 2008.

What are the impact of your initiative and the lessons learned?
Over the years, IRAS has been in the relentless pursuit of efficiency in the processing of tax returns. We introduced different modes of filing such as 1 page paper filing, phone-filing, E-Filing, AIS and pre-filled returns. Removing the need to file any tax return started off as a dream but IRAS has made it a reality with NFS. Since its implementation in 2007, the NFS has grown exponentially, hitting a record 787,000 taxpayers this year. We had the confidence to take this directional shift and embrace a new approach to tax administration as our culture is deeply rooted in innovation and excellence. Most importantly, we had a clear and consistent vision with strong leadership and commitment that allowed us to go where we had not gone before. We were open to feedback from our taxpayers and went to great lengths to engage and consult them. We have been able to move from an 8-page tax return in the distant past that caused taxpayers great stress and inconvenience, to a filing non-event. The NFS is a reflection of our commitment to continuously look for ways to provide excellent service. The E-TRS is yet another achievement by IRAS in its continual commitment to bring about greater convenience and satisfaction to taxpayers, be it in paying their taxes or receiving tax refunds. The E-TRS received much positive feedback from tourists and retailers, since its implementation in May 2011. In a recent survey conducted on about 800 tourists, more than 90% said that the E-TRS kiosks were easy to use and 95% that they are satisfied with the E-TRS claim process. Getting buy-in from intermediaries who we must collaborate with is essential to the success of our initiatives, as in the case of E-Stamping. By availing the system to anyone with internet access, we have removed the need for taxpayers to pay a fee for such service and provided much greater convenience. It is with these enhancements that IRAS is able to make quantum improvements in our service delivery to taxpayers as we press on with our pursuit of process efficiency, which will lead us closer to achieving our vision of being the “leading tax administration of the world”.


Institution Name:		Inland Revenue Authority of Singapore
Institution Type:		Government Agency
Contact Person:		Claire Chua
Title:		Corporate Planning
Telephone/ Fax:		63512107
Institution's / Project's Website:		www.iras.gov.sg
E-mail:		chua_wen_ying@iras.gov.sg
Address:		55 Newton Road, Revenue House
Postal Code:		307987
City:		Singapore
State/Province:		Singapore
Country:		Singapore

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