Electronic Tax Returns (ME0061)
Action Plan: Montenegro Action Plan 2018-2020
Action Plan Cycle: 2018
Lead Institution: The Ministry of Finance, the Tax Administration, Local self-governments – local revenue collection offices
Support Institution(s): Local self-governments – local revenue offices
Policy AreasE-Government, Fiscal Openness, Records Management, Sustainable Development Goals, Tax
Electronic delivery of Property Tax returns– a pilot project
Commencement and completion dates: January 2019 – august 2020
Responsible institution The Ministry of Finance, the Tax Administration, Local self-governments – local revenue collection offices
The issue at stake The calculation, collection and control of property tax collection is perfumed by the local administration authority responsible for local revenue collection. The amount of property tax payable is set by this body until 30 April of the current year. This tax is payable in two equal instalments, one by 30 June, and the other by 31 October of the given year. Local self-government units are obliged to keep records of all taxable property. State administration authority responsible for property is obliged to submit the property ownership data as of 01 January of the current year to the relevant local administration authority by 31 January of the current year. Within 30 days from acquiring the property, property owner is obliged to file a tax report to the relevant local administration authority to calculate the tax amount for the given year. All taxpayers are obliged to settle tax liabilities in line with the law within the timeframe stipulated in their tax returns. The Property Tax Law and the Tax Administration Law fail to provide any further details of the procedure for delivering property tax returns. The property tax return is to be delivered directly, through postal services, which often does not happen in practice. Up to 20% returns do not get delivered at all for various reasons: changed address of the owner, renaming streets, death of the owner, pending probate proceedings and failure to have relevant information on heirs in such instances. At times, however, incomplete and/or incorrect address of the taxpayer as obtained from the Real Estate Administration and the Interior Ministry (residents register) is the reason for failure to deliver.
The Tax Administration features on its webpages the Instruction for Credit Orders for Payment of Property Conveyance Tax, but before they can effectuate payment, citizens need to receive the relevant tax return. http://www.poreskauprava.gov.me/ResourceManager/FileDownload.aspx?rid=269819&rType=2
Commitment Create electronic access to property tax returns database, held by the local revenues collection offices, and the possibility to download the tax return.
How will it help address the issue The starting assumption is that there is a considerable number of taxpayers willing to settle their liabilities in a more straightforward manner with electronic access to the property tax return database, using own ID number (unique citizen identification number (JMBG) for the time being with additional reference to the AOP ), to download their return and execute timely payment. It is estimated that this option would greatly increase revenue collection, together with greater customer satisfaction and avoiding possible enforcement procedures.
Its relevance to OGP values Improved efficiency in accessing public services and better revenue collection
Additional information Compatibility with SDGs Reference to SDG 16: ‘Pease, Justice and Strong Institutions 16.5 – Substantially reduce bribery and corruption in all its forms 16.6 – Develop effective, accountable and transparent institutions at all levels Reference to SDG 17: ‘Partnership for the Goals: 17.1 - Strengthen domestic resource mobilisation, including through international support to developing countries to improve domestic capacity for tax and other revenue collection
The actions to be undertaken within the framework of this commitment will contribute to increasing transparency and accountability of public institutions by introducing electronic access to the database of property tax returns.
Actions with verifiable results and implementation dates
5.1 Establish e-access to the database of Property Tax Returns for the current year (the Tax Administration) – €20,000 - the new service at the Tax Administration’s portal developed - increase the number of service users by 20% compared to the current number
Points of contact
Responsible person in the implementing entity Goran Petrović, MoF, the Tax Administration
e-mail / phone firstname.lastname@example.org
Local self-governments – local revenue offices
IRM Midterm Status Summary
Language of the commitment as it appears in the action plan:
"Create electronic access to property tax returns database, held by the local revenues collection offices, and the possibility to download the tax return."
5.1 Establish e-access to the database of Property Tax Returns for the current year
Start Date: January 2019
End Date: December 2019
Context and Objectives
Similar to Commitment 4, this commitment deals with digitizing revenue collection. The government plans to create a database of all property taxes to local revenue collection offices, so each citizen can download their tax return in order to pay taxes.
The commitment includes two milestones that are specific enough to be verified: developing the Tax Administration’s portal and increasing the number of server users by 20%. Individuals will now have electronic access to their own tax information through the portal. However, the commitment will not disclose any additional information, and thus is not directly relevant to OGP values. This commitment could improve tax collection and positively impact national and local budgets. It could also improve the accessibility of personal tax information for citizens. Overall, however, this commitment represents a minor improvement to current tax collection practices.
As with the previous commitment, the IRM recommends including this commitment in Montenegro’s Public Finance Management Strategy. The government could add a tool to monitor public authorities to the Tax Administration portal and also share information on budgets and how they are spent.