Sunday, 5 April 2015

Taxation and technological development

One of the contentions in my book is that recent technological developments enable us to rethink taxation and what it can do.

Entrepreneurs develop technology that changes the economy and people’s lives in order to make profit. Tax system innovators aren’t going to make a fortune from it (sadly for me) but there is no less scope for revolutions in taxation as in other areas of life.

I suggest there are at least four areas where technology can be utilised, where each can be developed from the previous one:

1.       A secure website that enables accurate and real-time interaction between the taxpayer and the tax authority.

2.       Tax calculations can be cleverer, without making them overly obscure.

3.        Integrating the taxation and financial systems can mean tax is withheld as soon and accurately as possible.

4.       The greater use of electronic financial interactions and the above tax developments would make it harder for people to engage in fraud and criminal activities. Furthermore, IT developments can assist in fraud detection by flagging up those whose circumstances are more suspicious, enabling more targeted investigations.

In my subsequent blogs I will be outlining how the CLIPH-rate tax can utilise these advances. 

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