CAPE TOWN – The 2019 edition of the annual Paying Taxes report, produced by PwC and the World Bank Group this week revealed that tax authorities could do more to realise the full potential of new technology to reduce the tax compliance burden on taxpayers.
The report found that the global average results for the compliance burden for business taxation were almost unchanged across four key measures: time to comply (237 hours); number of payments (23.8); Total Tax and Contribution Rate, or TTCR (40.4 percent), and Post-Filing index (59.6 out of 100).
“Paying Taxes, 2019 draws upon a comparison of the taxation of business in 190 economies. The report models business taxation in each economy using a medium-sized domestic case study company,” read the report.
The report illustrates how developments in tax software, real-time reporting systems and data analytics are transforming the capabilities of tax administration. Some advanced economies have continued to improve their systems to the benefit of both taxpayers and tax authorities, recording significant decreases in the time it takes to prepare, file and pay taxes and in the number of payments indicator.
Yet, the report notes that the size of the gains in 2017 is relatively small in global terms. The fact there has been little change to the global average, despite 113 economies introducing tax reforms over the same period, suggests reforms are limited in nature (the report does not include the US tax reforms introduced in 2018 due to the data cut-off date for this edition of the Paying Taxes report).