e-Tax and Customs Board 2020 (EE0039)
Action Plan: Estonia’s Third OGP Action Plan 2016-2018
Action Plan Cycle: 2016
Lead Institution: Tax and Customs Board
Support Institution(s): All ministries; Employers’ Confederation, Chamber of Commerce and Industry, entreprises
Policy AreasE-Government, Fiscal Transparency, Public Participation, Public Service Delivery, Records Management
Description of the current situation or problem resolved with the commitment The current self-service environment of the Tax and Customs Board (hereinafter the TCB) the “E-Tax/E-Customs” was created approximately 16 years ago. By now it has become technologically and functionally out-dated, which in turn is a hindrance for realising the new, necessary functions and modern solutions (e.g. smart solutions, language options, machine-tomachine interfaces). The TCB is currently unable to achieve the sub-aim “Smarter governance” of the information society development plan 2020 (e.g. satisfaction with the quality of public services, settlement with einvoices between the public and private sectors etc.), as the technical platform of the e-Tax/E-Customs does not enable this. Main aim The TCB’s new self-service environment is being developed with the aim of making the submission of data to the state and the payment of claims in public law simple, comprehensive, central and contactless for the taxpayer (residents, non-residents incl. e-residents), while supporting the development of real-time economy solutions. While the current e-services have been developed in an official-centred manner, the new self-service environment must correspond to the needs and expectations of very different users – the accountant, director of a large enterprise, small entrepreneur, citizen, or e-resident. It is important to support an innovative business environment and give the entrepreneur the confidence that the tax administrator is the first point of help with taxation issues. The new e-services must enable compliance with tax obligations as simply as possible and at a minimum cost to the entrepreneur as well as the state. To support the competitiveness of the Estonian business environment, the services of the new e-Tax Board must be multilingual and mobile, i.e. the applications are developed as a responsive design. All of the TCB’s eservices will be of a similar appearance and user logic, which simplifies the use of different services for the taxpayer. Short description of the commitment (max 140 characters) The following will be done: 1) administration of taxpayer’s data. When managing persons’ data, the e-services of public authorities must enable persons to change their contact details from one place (e.g. if a person changes their telephone number in the eesti.ee environment then that information is immediately also sent to the other authorities and the person does not have to renew their contacts in various environments). The switch to a complete online data exchange between source registers (commercial register, population register) and the opportunity to administer persons’ data through the self-service channel without the official’s intervention helps minimise the client’s administrative burden when making register entries and ensures correct and reliable client data for the operation of e-services. 2) administration of taxes. When developing the new services of the e-Tax Board, the composition of the data necessary for compliance with the tax obligation is analysed, terminating the collection of unnecessary/duplicate information. Considering the technological possibilities of the modern day, hereinafter the data necessary for taxation will be used as the basis, not the requirements of traditional declarations. The aim is to make the submission of the taxation source data and payment of the tax obligation simpler and more convenient for the taxpayer. 3) administration of claims. The aim is to enable the taxpayers to use the main methods of payment accepted by Eesti Pank when paying claims in public law, and if necessary, to be ready to begin using other modern payment solutions (e.g. Paypal, Transferwise, e-money, virtual money etc.), which facilitate compliance with tax obligations in Estonia for non-residents. When paying taxes, the state must enable the e-invoice solution, which helps reduce the administrative cost of individuals when complying with the tax obligations. 4) single submission of data to the state and reuse. By changing the ideology of tax collection, the monitoring activity of tax collection changes as well. The aim is not to annoy the honest taxpayer when possible. The more precise risk analysis taking place online must bring only those taxpayers whose tax risks are high on to the monitoring officials’ desks. The taxpayer shall have the opportunity to monitor the course of the tax, debt or permit proceedings related to him or her in the e-TCB. The proceedings must be substantially carried out in the e-environment, using modern communications channels to the maximum extent (e.g. Skype, mobile telephone), to reduce the administrative cost of parties to the proceedings when communicating with the tax administrator. Thereafter, taxpayers (incl. as an employer) shall have the option of generating reports on the basis of the data in the tax administrator’s possession. This will be in their interest for comparing the indicators of their company with other entrepreneurs, as well as for sharing their data with business partners or the bank. The opportunity to compare their data on a rolling basis with other entrepreneurs of their sector of the economy, incl. competitors, increases the transparency of the business environment, improves tax compliance and gives an entrepreneur important basic information for necessary financial decision making. Part of the tax data must be available anonymously as open data in order to serve those who wish to be able to create new services.
IRM End of Term Status Summary
Commitment 1: e-Tax and Customs Board 2020
The Tax and Customs Board’s new self-service environment is being developed with the aim of making the submission of data to the state and the payment of claims in public law simple, comprehensive, central, and contactless for the taxpayer (residents, non-residents incl. e-residents), while supporting the development of real-time economy solutions. The following will be done:
1) administration of taxpayer’s data;
2) administration of taxes;
3) administration of claims;
4) single submission of data to the state and reuse.
1.1. Technical analyses of the IT systems’ platforms of the Tax and Customs Board (TCB) are carried out to build the new system.
- A visual of e-services is created in cooperation with end users to enable them to avail of the TCB self-service environment and its services as conveniently and simply as possible in the future.
1.2. User needs are analysed in cooperation with the consumer, asking for input from various associations and entrepreneurs in the course of direct meetings and as a result of the recommendation index method.
- Test environments and a product environment are created for the new developments being created.
- New non-functional requirements for the systems are developed in cooperation with IT.
1.3. The following is created as central components: administration of persons, administration of users, new payment methods, central administration of claims.
- The completed prototypes will be given to end users for testing. The feedback received will be taken into account in a further development activity.
1.4. Data-based taxation will be switched to; the submission of declarations will be minimised. For this, the respective legislation will be amended, and entrepreneurs that are end users of the service will be engaged though active communication.
1.5. A new platform (freeware) and a new architecture of the TCB information systems will be implemented.
Responsible Institution: Estonian Tax and Customs Board
Supporting Institutions: All ministries, Employers’ Confederation, Chamber of Commerce and Industry, enterprises
Start Date: January 2016
End Date: December 2018
This commitment sought to develop a new architecture and platform for the online self-service environment of the Tax and Customs Board (“e-TCB”) to simplify the submission of tax information and support the transition to data-based taxation. It planned to involve end users (including entrepreneurs, accountants, citizens) in different phases of the information system development process (from analyzing user needs to test the prototype) and the transition to data-based taxation. An additional objective of the commitment was to publish part of tax data as open data to enable the creation of new data-driven services, although this was not associated with a specific milestone.
By the midterm, the commitment had been substantially completed, though some preparatory activities had already started in 2014, before the action plan period. In 2016–2017, TCB carried out the technical analysis of the system (milestone 1.1), conducted meetings with users to analyze their needs (milestone 1.2), and involved users in testing the new e-TCB prototype (milestone 1.3).
TCB also made some progress regarding the planned shift to a data-based taxation system, including consultations with new platform businesses such as Uber and Airbnb. The next steps were to launch the new e-TCB platform by September 2018 and transition to a data-based taxation system by the end of 2018, although some further developments of the e-TCB were to continue until 2020. For a detailed overview of the activities, please see the 2016–2017 IRM Progress Report.
End of Term: Substantial
By the end of the action plan period, the commitment remains substantially implemented. Milestone 1.5 (transitioning all TCB information systems to a new platform and architecture) has been implemented, but milestones 1.3 and 1.4 remain in progress. According to the government’s end-of-term self-evaluation report, part of developing the central components of the new e-TCB is ongoing. This mostly concerns the implementation of the new authentication, access, and authorization solution, which is expected to be completed by spring 2019.
TCB continued to make progress toward shifting to taxation based on bank transaction data instead of declarations. A pilot project has been launched in cooperation with the LHV Bank enabling automatic payments of the required taxes along with the salary payments to employees. Apart from this pilot, milestone 1.4 remains far from being fully implemented, as the government is still discussing the legal feasibility and consequences of abolishing different kinds of tax declarations.[Note 1: Kersti Karuse-Veebel (Estonian Tax and Customs Board), interview by IRM researcher, 13 November 2018] Regarding the publication of tax-related data as open data, the TCB is planning more concrete steps in 2019.[Note 2: Kersti Karuse-Veebel (Estonian Tax and Customs Board), interview by IRM researcher, 13 November 2018]
Did It Open Government?
Civic Participation: Did Not Change
Experts consider Estonia’s tax system to be among the most advanced ones in the world. The Tax Foundation’s International Tax Competitiveness Index has ranked Estonia first among OECD countries since 2014.[Note 3: See: https://taxfoundation.org/publications/international-tax-competitiveness-index/] Estonian residents have also been able to declare their taxes online since 2000. However, by the start of the action plan, the e-TCB system had been in use for 16 years and was technologically outdated. This commitment sought to modernize TCB’s information systems by designing cost-effective and user-centric e-services for tax reporting and collection. Although many of the planned activities and goals were related to in-house procedures, the commitment included a civic participation component, as it involved consultations with end users in designing the e-TCB. The IRM Progress Report found that during the development process, a number of individuals, professional associations, and local governments were consulted in all 15 Estonian counties.
According to Kersti Karuse-Veebel, the development manager of TCB, different user groups (in particular business representatives and accountants) have been engaged throughout the development process, involving on average 10 to 20 people in each user group.[Note 4: Kersti Karuse-Veebel (Estonian Tax and Customs Board), interview by IRM researcher, 13 November 2018] Mait Palts (Chamber of Commerce and Industry) considers the commitment to have been implemented in a highly participatory manner and is satisfied with the extent to which user feedback has been taken into account, such as customizing the e-TCB user interface to the needs of different types of users.[Note 5: Mait Palts (Chamber of Commerce and Industry), interview by IRM researcher, 16 November 2018] The development of the e-TCB has made use of a range of user engagement methods – from customer satisfaction surveys to interviews and online feedback forms on the prototype of the new interface.[Note 6: “Avaliku sektori lugu: Maksu- ja tolliameti uus kliendikeskne e-keskkond”, 22 November 2017. Accessible at: https://disainikeskus.ee/disainiblogi/maksu-ja-tolliameti-uus-e-keskkond-e-mta ] However, both Palts and Karuse-Veebel claim that user engagement in ICT development has already been a regular practice of TCB for several yearsTherefore, the commitment did not bring any changes to government practice compared to the status quo prior to the action plan.
This commitment has not been carried forward to Estonia’s fourth action plan. As two milestones of the commitment have not yet been reached, the crucial next steps for TCB include completing the technical developments by 2019 and continuing the analysis and planning for the shift to data-based taxation.
transparent and inclusive policy making
EE0048, 2018, E-Government
EE0049, 2018, Capacity Building
EE0050, 2018, E-Government
national and local government action plans
EE0051, 2018, Public Service Delivery
presentation of local public services
EE0052, 2018, E-Government
participatiory democracy capacity-building
EE0053, 2018, Capacity Building
e-Tax and Customs Board 2020
EE0039, 2016, E-Government
Reducing bureaucracy and a simpler state – the zero bureaucracy project
EE0040, 2016, Capacity Building
Implementation of the principles of open governance at local level as a result of the administrative reform
EE0041, 2016, Capacity Building
More inclusive policy-making on a central government level
EE0042, 2016, E-Government
More open and transparent law-making
EE0043, 2016, Anti-Corruption Institutions
Increase of the engagement capacity of state authorities and participation capacity of nongovernmental organisations in policy-making
EE0044, 2016, Capacity Building
Intensify participatory budgeting on a local level
EE0045, 2016, E-Government
Increasing the transparency of the funding of non-governmental organisations
EE0046, 2016, Anti-Corruption Institutions
Defining participatory democracy and development of digital competence in school education
EE0047, 2016, Capacity Building
Visualisation of the policy making process
EE0016, 2014, Public Participation
Upgrading participation channels
EE0017, 2014, E-Government
Improving government website
EE0018, 2014, E-Government
Standard for information requests
EE0019, 2014, E-Government
Early notice on policy-making processes
EE0020, 2014, Public Participation
Participation in early stage policy-making
EE0021, 2014, Public Participation
Early access to tax policy decisions
EE0022, 2014, Public Participation
Better feedback mechanism
EE0023, 2014, Public Participation
Selecting and funding participation projects
EE0024, 2014, Civic Space
EE0025, 2014, E-Government
Civil servant guidelines for participation
EE0026, 2014, Capacity Building
Training civil society organizations (CSOs)
EE0027, 2014, Capacity Building
Central government transactions
EE0028, 2014, E-Government
Local authorities' transactions with private entities
EE0029, 2014, Civic Space
Public spending for non-profits
EE0030, 2014, Civic Space
Guidelines for citizen budgeting
EE0031, 2014, Capacity Building
Guidelines for redesigning public services
EE0032, 2014, E-Government
Registry of public services
EE0033, 2014, Open Data
User-centric public services
EE0034, 2014, E-Government
Access to e-services for non-residents
EE0035, 2014, Citizenship and Immigration
Open data portal
EE0036, 2014, E-Government
EE0037, 2014, Capacity Building
Supporting nongovernmental open data use
EE0038, 2014, Capacity Building
Drawing up a green paper on organisation of public services
EE0001, 2012, Public Service Delivery
Implementation of the eesti.ee action plan
EE0002, 2012, E-Government
Drawing up a green paper on making public data available in a machine-readable form
EE0003, 2012, E-Government
Creating a repository of public data
EE0004, 2012, E-Government
Launching pilot projects of public data services based on the cloud technology
EE0005, 2012, E-Government
Interactive guidelines and training in implementation of the Good Practice of Public Engagement
EE0006, 2012, Open Contracting and Procurement
Launch of the impact assessment system
EE0007, 2012, Legislation & Regulation
Overview of ministries’ work processes
EE0008, 2012, Capacity Building
Integration of impact assessment into the process of public engagement
EE0009, 2012, Legislation & Regulation
Creation of a database of declarations of economic interests
EE0010, 2012, Conflicts of Interest
Adjustment of the system of funding non-profit associations and establishment of a disclosure system
EE0011, 2012, Private Sector
Drawing up a proposal for drawing up an anti-corruption strategy
EE0012, 2012, Anti-Corruption Institutions
Draft Anti-Corruption Act
EE0013, 2012, Anti-Corruption Institutions
Establishment of the Public Ethics Council
EE0014, 2012, Conflicts of Interest
Organisation of ethics training for employees of various public sector organisations (incl. public servants)
EE0015, 2012, Capacity Building