| 4. In which ways is the initiative creative and innovative?
Proposal for the system were initiated by Stamp Duty Division and Information Technology Department of Inland Revenue Board of Malaysia. The initiative was developed to enhance the efficiency in the service delivery system in line with the government policy to promote e-Government.
There were few strategies used to implement the initiative. Among them were the setting up of a steering committee, system development committee, system for development and planning committee, pilot and user acceptance test, stress test, training and briefing.
To oversee the implementation and success of the project, IRBM formed a Project Steering Committee headed by the CEO of IRBM. The committee member includes Deputy CEO (Tax Operations), IRBM’s CIO, relevant heads of department and user leaders. A committee was formed to oversee and monitor the development of the initiative and to ensure the system progress according to the objective and time specified. The steering committee consisted of officers at the management level of Inland Revenue Board of Malaysia. The committee would also make decisions whether to approve, to reject or to propose alternative solutions if necessary. All approved proposals were officially endorsed by the committee. The system Development Committee consisted of officer from Stamp Duty Division and Information Technology Department.
The first pilot run of user acceptance test was set up involving Stamp Duty Offices in the area of Klang Valley. The second pilot run was conducted and extended to all users throughout the country. Stress test was also done to determine the sustainability as well as the ability of the line for the system usage.
Training and briefing were held for IRB officers and Valuation and Property Department’s staff as well as legal firms to ensure the success of the system. A help desk was set up to assist in solving problems encountered by the users.
STAMPS was developed using a Web service technologies for real time integration and Scheduler method for batch job integration. Each development process initially has to go through with requirement specification until implementation in stages below:-
16 February 2009
- Pilot run on transfer of landed property instrument involving all Stamp Offices in Malaysia.
22 Mei – 6 Jun 2009
- Pilot run involving Eight (8) Stamp Offices in Klang Valley for all instrument.
15 Jun 2009
- STAMPS has been implemented throughout all Stamp Offices in Malaysia for all instruments.
| 5. Who implemented the initiative and what is the size of the population affected by this initiative?
The stakeholders of the initiative consisted of the Malaysian Government, appointed agents, Valuation and Property Services Department (VPSD), and IRBM. The Malaysian Government is the main stakeholder as stamp duty is revenue collected by IRBM on its behalf. Speedy and accurate collection of revenue is important. Fast and accurate assessment on stamp duty to be paid is the main concern to the lawyers, agents and duty payer.
VPSD is the official valuation authority appointed by the Collector of Stamp Duty in accordance with the Stamp Act 1949. It plays an important part in the stamp duty collection process as stamp duty for transferring property is calculated based on the market value of the property or the consideration paid, whichever is the higher.
IRBM, the owner of the system whose main function is to assess and collect the stamp duty payable on the instrument has to ensure not only speedy revenue collection but also a simple and efficient service delivery system.
Besides the above mentioned stakeholders, feedback from the main target group for STAMPS were sought during the development stage of the system. The target group includes representatives from legal firms, banks, company secretaries, accounting firms and companies. Inputs from these parties have been taken into consideration in developing a comprehensive and user friendly system. With the user’s convenience in mind, STAMPS was designed with the capability of online submission and supporting documents and instruments that can be scanned and uploaded in the system. The applicant or users will also be able to keep track on the status of the adjudication online.
| 6. How was the strategy implemented and what resources were mobilized?
a) Financial Allocation
STAMPS is an application which its development started in year 2009 in conjunction with the Ninth Malaysia Plan (RMK-9). The development of STAMPS was carried out by outsourcing it to vendor with the user specification requirement and the technical requirements provided by the IRBM officials from the Information Technology Department and Stamp Duty Division. The whole budget allocation were located for enhancement, development of new request and extension of scope from 1.11.2008 until 28.02.2012.
b) Expansion of System Infrastructure
STAMPS architecture consists of complex infrastructure namely server, storage, archiving and load balancer to accommodate high volume of transactions and data.
• Stage 1
Software used is Oracle using Redhat Linux Operating System. It consists of data migration and hardware requisition. It is base for the development of the computerization and a strategic approached to cater for the overwhelming expansion.
• Stage 2
Software used is PHP and Oracles. It is an expansion of system, functionalities in order to cater for the computerization of the whole system.
c) System Functionality Enhancement
• Application for User ID
Before STAMPS, registration for user ID is done manually but in STAMPS registration for user ID can be done online.
• System usage
Before STAMPS, system for online assessment is only limited to a single buyer/seller transaction for transfer of property only. In STAMPS there is no limitation and the information can be saved and amendment can be done for all types of instruments / transactions.
Before STAMPS, the coverage is only within Peninsular of Malaysia but with STAMPS, coverage is extended to the state of Sabah and Sarawak in East Malaysia.
• Human Resources
To provide expertise from various fields including in the area of business, technical and security that relates to the system.
o Business Experts consist of external users which comprises of those law firms, agents and Valuation and Property Service Department. Internal user refers to Stamp Offices, Revenue Service Centre and other related department in Inland Revenue Board of Malaysia.
o Technical Experts consist of those responsible for the development of infrastructure and for the development of the application. The infrastructure experts provide advice on the system architecture which includes server platform, network environment and security requirement. The application developers will be responsible on the system and data base design based on user requirement.
o Security Experts will be responsible in designing the certificate with security features which conforms to the local act and acceptable Digital Signature Act 1997.
| 7. Who were the stakeholders involved in the design of the initiative and in its implementation?
Employees of IRBM have adapted themselves to the work culture of using computers to carry out their daily work. Assessors and officers communicate online. Monitoring and management of stamp officers can also be done through STAMPS. Comprehensive reports and statistics generated by the system enable the management to analyze any trouble-shooting as well as formulate policies.
With STAMPS, the filing and communication between agents and IRBM officers is done electronically for free which is most valued by the business entities. STAMPS have made business process become simpler and speedier as time is essence and is translated into money.
Through STAMPS, each application can be viewed and processed in a transparent manner to ensure the accuracy of the assessment. For example, the assessor can view the attached documents as many times as needed to ensure that the data keyed into the system by the user is accurate. The system will calculate the duty automatically.
Collector can view the transaction again at the endorsement stage. If there is any error or the duty payer is not satisfied with the duty charged, the assessment can be corrected or a new notice will be issued before any payment is made. Any mistake or error can be traced immediately from an early stage and an appeal can be made instantly.
c) Delivery System
The success of STAMPS is proven where processing time for stamping is reduced significantly. More applications can be processed as the processing time is shortened. This meets the original objective of STAMPS which is to deliver a better service to the people. Applications and payment can be made at any time without being restricted to the counter operating time i.e. 8.00 am up to 3.30 pm on working days only.
STAMPS saves time, costs and is environmentally friendly for the following reasons:
o Paper application forms are replaced by electronic forms.
o Notice of assessments is generated by STAMPS.
o Notice of assessments are available electronically thus saving postage cost/communication cost.
o Save transportation and man power cost to send documents to VPSD/JPPH for ascertaining the value of property.
o From the accounting perspectives, accounts management is simplified with electronic payment. Assessor need not have to verify list of cheques received with Collection Statement before sending the revenue collection to the bank. Revenue leakage caused by dishonored cheques and stamping fraud can also be prevented.
o Wage and transportation cost for the law firms and agents are reduced and indirectly, the cost incurred by the customer is reduced too.
o Administrative expenditure involving stamping and labor cost for dispatch are reduced which results in an overall reduction in cost of doing business.
e) Economic Growth and Improvement of Skills and Expertise
With the launch of STAMPS, it gave an economic and work opportunity to the vendors. Person who benefits from the job opportunity can increase their skills and expertise in information technology.
| 8. What were the most successful outputs and why was the initiative effective?
Stamp Duty Division is one of the divisions under the Revenue Management Department in IRBM. Among its main function is to recommend proposals on the legislation pertaining to stamp duty to the Finance Ministry, overseeing the operation of Stamp Offices, providing technical advisory as well as training for staff stationed at Stamp Offices. The Information Technology Department is tasked with the responsibilities of designing and developing operation system as well as maintenance of server, system network hardware and software.
To oversee the implementation and success of the project, IRBM formed a Project Steering Committee headed by the CEO of IRBM. The committee member consists of the Deputy CEO (Tax Operations), IRBM’s CIO, relevant heads of department and user leaders. The CEO of IRBM was the patron and the Deputy CEO in charge of Tax Operation was the advisor of the committee. The Director of Revenue Management Department was appointed as project Manager. The committee members were made up of Directors of Stamp Duty Division, Information Technology Department, and Administration Department. The main function of this committee was to act as driving force as well as to oversee the progress of the project from time to time.
A working committee was also set up to monitor the actual running of the system, in which officers from Stamp Duty Divisions as well as Information Technology Department sits in the committee. The Stamp Duty Officers were responsible for the operational work with officers from Information Technology Department taking charged of the development and application of the system. This committee was set up to study the technical application system. Its main function was to coordinate and oversees project development as well as submitting proposal for any amendment to the project to the steering committee.
The devolvement and planning system was used as mechanism to prepare Gantt chart as tool to oversee the progress of the project according to the plan. The user requirement specification was developed by the system development committee with the co-operation of the officers from branch Stamp Office in formulating the needs of the users and the specifications of the system. System development team was set up by the Information Technology Department of IRBM and the vendor to design and developed the system. The server and network team was set up to oversee the smooth running of the system line so that there would be in good condition with minimum disturbance.
| 9. What were the main obstacles encountered and how were they overcome?
There were several obstacles encountered during the implementation of the initiative which consists of internal and external factors. The main obstacle is obtaining the budget to improve the existing system during the development stage. To develop the system, huge investment must be made on the infrastructure to accommodate the requirement of the users. This includes upgrading the existing computer system to increase the capacity of the server to cater for processing and storing data.
The initiative that was being developed would require the attachments of documents to be uploaded into the system. With a higher server capacity, information can be generated and extracted easily at any time. The upgrading and replacement of hardware, networking, and software licenses is capital intensive and requires substantial financing.
To overcome this issue and ensure the optimal capacity with minimal cost, the system was implemented in developed in modules and stages and part of the budget needed was acquired from some other allocation within IRBM’s own resources.
The other obstacle to the success of implementation of STAMPS was initial resistance by IRBM’s personnel itself. Users are new to the new work processes and tend to make mistakes. User acceptance of using web base in certain application was low.
This issue was addressed by strengthening the training strategy and setting up of coordinated help-desk. Road shows were also conducted by Stamp Offices at regional level. Briefing and training were also organised to educate the external user about e-stamping process through the system. Simultaneously user will be informed about the advantageous and benefit acquired by using the system. Feedback from user regarding their requirement will also be taken into account in any technical design improvement.