What you will learn

A number of tax administrations have recognized that large taxpayers are different from other groups of taxpayers, present different revenue risks and require different strategies to maximize tax compliance. In this context, they have established special systems to administer and deal effectively with this segment of taxpayers. This focus on large taxpayers is driven by the fact that, in most countries, large taxpayers contribute at least one third of total taxes, and sometimes more than a half. Evidence from practice also suggests that many countries by establishing large taxpayer’s office are better at addressing major operational weaknesses in tax administration and improving core tax administration functions.

This workshop will review the common characteristics of large taxpayers and address the criteria for the assignment of taxpayers to the large taxpayer office. It will consider current best practice about assessing the risks and the compliance issues commonly associated with large tax payers. In addition, there will be a module on the design and introduction of an annual tax on residential property in Ireland. A detailed case study will show how the design of the tax made it easy to pay but difficult to evade resulting in a compliance rate of over 90%in the first year of operation despite some taxpayer and political resistance. Again, this example will show how tax strategies need to be adapted to specific sectors and must have very specific responses to the risks in each sector. This module will be delivered by a senior official from the Irish Revenue.

Course sessions will use a seminar format with a number of hands-on exercises built in to maximize learning about the different strategies and approaches tax administrations can use to better manage and improve large taxpayers’ compliance. In particular, the course will outline how co-operative compliance programmes can help tax administration restore trust and confidence with businesses community and in this context demonstrate the value of co-operative compliance approaches. Essential principles concerning governance in tax administration (including attracting and retaining staff of sufficient caliber to audit complex operations, providing large taxpayers with accurate and up-to-date information, creating a professional work environment that discourages tax officials from engaging in corrupt practices) will also be discussed.

The course will also show how the developments in large business taxation are part of a wider EU Compliance Risk Management model based on the idea of segmenting taxpayers into clearly defined segments based on risk criteria. In this context the Irish property tax example will show how good design reduced evasion and how a compliance rate of over 90% was achieved before any audits took place.

How you will benefit

The course will be highly interactive and participants will be encouraged to share their views and professional experiences. Course content will be explained through theoretical presentations, supported by specific and concrete examples. Apart from the plenary sessions, participants will split into small groups to discuss key issues and will work on group assignments.

By the end of the course participants are expected to have:

• developed a better understanding of why there is a need for large taxpayer offices
• discussed what are the requirements for the large taxpayer office to work properly
• strengthened the ability to identify major tax compliance risks for large taxpayers
• learned how these major compliance risks are managed and how large taxpayers are selected for supervision
• improved knowledge of what special approaches tax administration can use to maximize tax compliance (including the cooperative compliance programmes)
• learned about the internal governance structures, the special roles and skills needed to make the management of large taxpayers office work
• gained a basic understanding of the EU Compliance Risk Management model
• learned from the Irish example how good tax design makes compliance easier and reduces the need for costly and intrusive audit programs
• had a basic understanding of the EU Compliance Risk Management model and how it encompasses areas as diverse as large taxpayers and private residential property taxation

Who should attend

The course is intended for senior or experienced revenue officials (directors, deputies, and heads of departments, either from head office or from regional offices). Participants should be involved and / or have experience with procedures pertaining to large taxpayers within their institutions.