ABSTRACT
The traditional image of any indirect tax department is one of regulatory authority, wielding tremendous power, whereby taxpayers have to queue up for various purposes, and the working of the department is mostly through the legacy manual systems. The digital transformation was carried out in the departments, during the Value-Added Tax and Goods and Services Tax regimes, which was composed of a multipronged systems approach. By winning over taxpayers to modify their interface with the department, bringing internal transparency, accountability, using new ideas in ensuring tax compliance, and involving citizens in ensuring compliance using information, technology and mobile technology are the basic elements of this approach.
The transformation was in moving the tax department from a regulatory approach to a service provider approach with the delivery of services electronically at their doorsteps in a time-bound manner, introducing self-policing by the taxpayers, removing check posts, and bringing transparency and accountability into the processes.
The interface of the tax department with its taxpayers was converted to an interaction through the ‘internet’ only. To support this electronic interface, the internal processes, as well as the laws and the rules, had to be amended. All the stakeholders involved in the process were convinced, as well as trained, to switch over to a new style of functioning. The digital transformation was a win–win situation for the taxpayers, the citizens, and the government.
