Modernised IRD and Revenue Authority to change fiscal landscape
View(s):By Bandula Sirimanna
The Inland Revenue Department (IRD) is currently undergoing a modernisation process to support recent tax policy reforms moving towards the automation of its core activities in a bid to improve efficiency, transparency and financial flexibility, Finance Ministry sources said.
The online portal is being upgraded to simplify individual income tax filing and accelerate outreach to re-register VAT taxpayers who dropped out and finalise improvements of the Random Access Management Information System (RAMIS) soon.
RAMIS will be used to support the assessment of 2022/23 income tax returns and to administer and assess the Social Security Contribution Levy (SSCL) by end June 2024, with a view to reducing interactions between taxpayers and tax officials, a senior IRD official said.
“We will more broadly ensure that processing tax collections is only carried out through RAMIS (as of June 2024),” he added.
The ministry has developed a medium-term IRD modernisation strategy and Implementation Plan with IMF assistance and will have it fully documented and endorsed for implementation soon.
Meanwhile the ministry is drafting legislation to create a semi-autonomous Revenue Authority, incorporating initially the Inland Revenue Department, and later the Customs and Excise departments.
The aim is to strengthen revenue collection in the long-term and increase revenue administration professionalism and effectiveness.
However he noted that creation of such new institution will take time and will require significant resources, and every effort will be made to ensure that this does not undermine the effort to increase revenues.
The ministry will consult with IMF experts before taking further steps in establishing the Revenue Authority.
It will obtain cabinet approval by August 2024 for an information technology strategic plan to deliver the RAMIS (version 3.0) with the needed functionality enhancements and design improvements
RAMIS installed at the Inland Revenue Department (IRD) is to be reactivated changing the original design and software system, ministry sources disclosed.
The new system will reverse the unintended consequences of the original design that resulted in even more discretion and interaction between revenue officials and taxpayers, and a misutilisation of scarce IRD resources, he said.
Moreover there have been some encouraging developments in public procurement process, such as developing the Procurement Management Information System (PROMISe) which is being developed but is currently in a pilot phase.
It has the potential to be a key tool for improving the integrity of public procurement by enabling better processing, tracking, recording, reporting, and publicising procurement actions and outcomes, he added.
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