United Nations Public Service Awards Case Studies

In 2001, there were approximately 22 million vehicles needed to pay tax in Thailand with 7% growing rate annually. However, the tax administration process being used for more than 30 years since the number of vehicle was only less than one million had been an obstacle to tax collection process. Lots of documentation taxpayers needed to present by law and long waiting time forced taxpayers to be absent from work just to pay vehicle tax. Many taxpayers avoided this situation by neglecting tax payment. Using service agencies found around the Department of Land Transport (DTL) office was another option to pass up the difficulty. Yet, some of these agencies were fraud, which make the taxpayers ending up with deceit payment tag and voucher.

Another obscurity concerned was obsolete laws and regulations. Such laws prevented taxpayers in paying vehicle tax, for example, a regulation required taxpayers to present a vehicle booklet when making tax payment. In many cases, vehicle owners applied leasing service and had the vehicle booklet seized. Also, leasing companies took advantage of this law by forcing taxpayers to pay tax using their service with additional fee. This extra fee amount was estimated to approximately 20-50% surplus from the tax figure to be paid.

The governmental financial shortfall of this avoidance and scam was estimated to be approximately 3-5 billion baht. Furthermore, the rights of vehicle owners were taken away if accidents occurred, i.e. being forced to take responsibility for the damages. The law also requires that vehicles older than 7 years are to assess the conditions whether they are in good settings for safety and environment before paying tax. Once the vehicle tax was avoided, there was no need to have the vehicles assessed. As a result, vehicles with improper conditions were used and caused accident. These problems tended to increase ever year with the growing number of vehicles registered.

What is the initiative about? (the solution)
Since the vehicle tax payment service had been reformed, DLT could serve 4.9 times more taxpayers each day. This resulted from drastically service time reduction to approximately only 1 minute. Taxpayers can pay tax and get the payment tag without getting out of the vehicles with “Drive Thru for Tax” service. The reform process is so fast that it eliminates the necessity of agencies. Therefore, taxpayers save both time and money. Also, by taking away the agency system, fraud tag was not anymore the issue. Consequently, tax collection noncompliance level or tax gap had been improving from 50% in 2001 to 30% in 2008. To observe customer’s point of view, the survey was conducted and the overall result was that customer satisfaction level hit 97%. The survey result also showed that taxpayers were most satisfied with staff manner, which resulted from less stress and better morality. This reform was so success that it was granted “Public Service Quality Award” from Office of the Public Sector Development Commission and being a model for other national government agencies in reforming service processes.

Who proposed the solution, who implemented it and who were the stakeholders?
Starting with the 1989 World Bank’s report on Sub-Saharan Africa, the notion of “Good Governance” was introduced for good management of government mechanisms in administering social and economic resources for development. Thailand then exploited this idea and incorporated it into its 9th National Economic and Social Development Plan in 2002. DLT as one of the government agencies took this policy and start taking it into action. By setting up steering committee and working teams to assess and analyze the problem. The working team, comprised of its own personnel and professionals from educational institutions, started sharing ideas on red-tape cutting methods to better serve DLT’s customers. DLT started by amended its regulations on many issues, such as cancellation of request form submitting in order to pay tax, elimination of using vehicle booklet in tax payment process, etc. However, piecemeal changes were not enough; a larger structural reform to enhance more efficiency was needed. One-stop service program was the reform option then. The officers in the tax collecting section and relevant units took part in sharing ideas and visions, participating and taking responsibilities to steer and implement these development activities, which create a sense of ownership & partnership to the program, led to tremendous success. Moreover, the program had been evaluated regularly in terms of service quality to ensure customer’s satisfaction. Also, other KPIs regarding number of fraud the level of tax payer’s noncompliance (tax gap), and tax collection figure (taxes actually paid comparing to taxes should be paid) were reviewed periodically. Later on, DLT scaled up what it had been doing with its stakeholders; leasing companies, auto insurance agencies, and citizens; to get people’s participation and involvement in planning and decision-making processes on further improvement of the program. Several meetings and conferences were held. Comments and recommendations were obtained during such meetings.

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 expected outcomes of this innovative project were tremendous. The objectives of the project were not only to expedite the service time or to improve the efficiency of services delivered, but also to create good governance, which were more people oriented and more transparent. Reducing the tax collection process’s complexity to encourage tax payers compliance voluntarily would ultimately resulted in increasing governmental revenue. These objectives and targets for undertaking this initiative were set by the committee in 2 approaches, short term with the 2-3 years achieving results, and a continual process responding to changing service trends and policy developments. To achieve the expected results, DLT (the working team, with approval from steering committee) set strategies to implement the initiative as follows: • increase compliance level by tax collection process reform with innovative measures, • continuously adjust the organization and procedures to meet the revolution in computer and communication technology, • revise laws and regulations to speed up the process and strengthening collection enforcement • improve staff ability to deliver service more efficient with better service mind through effective training system

b. What were the key development and implementation steps and the chronology? No more than 500 words
The project was initiated in 2002 shortly after the division had computerized all the processes and established centralized network to offer faster and more accurate service nationwide. First, one-stop service concept was introduced and has been applied to vehicle registration tax collection service. In the first step of the reform process, laws and regulations relating to service procedures had been reviewed and changes required were identified. Meetings with leasing companies, insurance agencies, and other concerned businesses were conducted. In August 2002, DLT announced the revised regulation that the taxpayers were not required to present the vehicle booklet when paying vehicle tax. Moreover, to decrease noncompliance level and to encourage tax payer to settle their tax arrear quickly, DLT amended the vehicle act to suspend the vehicle registration of the vehicle with more then 3-year tax arrear and give amnesty to vehicle owners with tax overdue Later, in December, the tax payment tag changed from a sticker affixed to a vehicle’s windscreen to a piece of paper printing with the receipt, which reduced cost significantly. During the period, standardize procedures were established. Staff key competencies were identified and training sessions were developed and trained. Finally, in May 2003, one stop service measure was in effect. As a result, the service time remarkably reduced from more than 30 minutes to only 1 minute. Customer satisfaction level jumped drastically to 97%. However, to continuously improve the service quality level and accessibility, DLT started a new development “Drive thru for tax”, which began in pilot project to design and test new procedures. After the project feasibility study conducted, the “Drive thru for tax” service became operational in January 2006 at headquarters. In addition, “Shop Thru for tax” service had been launched in July the same year, first at 9 Carrefour branches in Bangkok. The result was a big hit with approximately over 100 taxpayers a day per branch used the service. After a huge success, the projects had been expanded to several major cities, such as Chiangmai, Phitsanulok, Chonburi, Nakornratchasima, etc. DLT went further in enhancing accessibility for taxpayers, since April 2007, taxpayers can pay vehicle tax anywhere through the internet using e-Banking, credit/debit card and through ATM machine.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
Despite the key achievement stated, there remain a number of obstacles that DLT encountered. Significantly, the lack of involvement from stakeholders was considered the main barrier. Inadequate buy-in from key stakeholders, including middle managers and officers who actually work at the table, created resentment. People get comfortable and become used to doing things a certain way. Therefore, getting management and staff involved in design and implementation of the reform process from the outset is crucial. No follow-up provisions were planned. Failure to follow up and insure effective implementation impeded the success of the project. The reform required people and systems to change as well as keep pursuing the new path. Moreover, frequent changes in personnel in charge of the co-ordination and whom responsible for following-up the project have resulted in significant setbacks. The management team learned this fact and started setting means and indicators to track the status and success of the projects. When expanding the project to other major cities, there was a challenging task to work across government departments due to different institutional cultures. To overcome this issue, several meetings and field trips were conducted for both staff and stakeholders in other cities. Another main obstacle to the reform was ineffective training program. Although there were time and money allocated for staff training, but it was not that effective. Staff joined the program since participation was required, but often necessary skills were not fulfilled. To resolve this, on-the-job training and coaching program was established along with the standard procedure manual.

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
Since resource allocation was viewed as one component of comprehensive reform efforts, DLT adopted a framework for guiding resource allocations to support the implementation of the reform in fiscal, staff, and technology aspects. The practices used, such as need-based budgeting, innovative staffing models, increased using of technology, and leveraging of outside resources, were found successful. In this reform process, DLT set up the resource management plans by estimate the needs for each implementation step. At the beginning, the main source of the reform’s financial was from internal fund. Later, when DLT began Drive Thru for tax campaign, the government support in funding for infrastructure and technology. Expanding this reform to other major cities did not require much of the budget. Most of the funding came from private sector’s support. As for human resources, during this reform, manpower used was decreased immensely, resulted in administrative cost saving. Moreover, by re-structuring staff task along with ICT development regarding to the reform process, more service was delivered to taxpayers.

Is the initiative sustainable and transferable?
The DLT has set this project as the agenda for every regional branch to bring all services up to standard and make the improvement and review of this standard occasionally. By executing this agenda, the DLT management team has set the activity of group knowledge sharing between branches as well as set a motivation among member in the group. As a result, the Nakronrasrima Provincial branches have successfully adopted the standard and make its own improvement to other service. Also, the DLT has promote tax payer’s awareness of the different channel for paying such as online channel, 7-11 convenient shop channel, counter service in the department store, and counter service at the DLT in order to gain positive customer relation and support. As to make this project sustainable, the DLT has implement the Plan-Do-Check-Act or PDCA process by initiating both internal and external customer surveys on continuous basis. The results from surveys have been analyzed by group of committee and policy has been updated. One of the success result is the drive thru service in which the committee has been analyzed the time spent in the process from entering the service facility until the service is completed. The analysis showed that the time count is not including before service activities such finding parking space, traveling to the facility and so on. The new system, drive thru service and online service, has been implanted in order to cut the time in finding parking space as well as traveling time. This process has been implementing to all facility in Bangkok as well as expanded thru other regional branches.

What are the impact of your initiative and the lessons learned?
As the process of reform, many things have been learned. The first thing is the change of staffs’ attitude that at DLT we are not just only a civil service, but we are human service. This new attitude makes the different in the new service system and effect the behavior of staffs. The new system is required the change from multiple processes to single process or single service. That means a system require less people to work on the same quantity of works and the staffs fear that they have to work harder than normal. But this problem has been solved and proved by showing the fact that one job has been repeatedly done many times as it go thru multiple processes compare with the job has been done one time for single process. It means that the staffs spend less time on the job. Another thing encountered is the change of notification and regulation. The new process does not require bringing the vehicle registration booklet. The booklet is the official ownership document that the car owners have to keep in the safe place. Often time the banks or financial institutes want to hold the booklets as the guarantee for their leasing. When the car owners fail to pay their dues, the financial institutes stop paying for the annual registration tax. As a result, the car owners cannot use their car legally in the public street. This incident is affecting legal right of the car owner. As new process takes place the car owners can pay their tax without bringing the booklet and they can use their car legally in the public street regardless of their difficulty with their financial institute. These show the protection of legal right and human right and the support of street safety.


Institution Name:		Department of Land Transport
Institution Type:		Government Department
Contact Person:		Chairat Sanguancheu
Title:		Director General
Telephone/ Fax:		66-2272-5315
Institution's / Project's Website:		66-2272-5316
E-mail:		chairat@dlt.go.th
Address:		1032 Pholyothin Road
Postal Code:		10900
City:		Jatujak
State/Province:		Bangkok
Country:		Thailand

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