Revenue Administration: Performance Measurement in Tax Administration

Technical Notes and Manuals, July 29, 2010

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This technical note describes measuring performance in tax administration.
Performance measurement is an ongoing process of ascertaining how well, or how poorly, an organization is achieving its goals and objectives.
It involves the continuous collection of data on progress made in this regard.
Performance indicators, or measures, are developed as standards for assessing the extent to which these objectives are achieved.
The note explains key features of performance management and performance measurement and outlines how tax administrations can apply performance management at the strategic level.
Key tasks in implementing a performance management system are described.

Performance measurement requires continuous data collection on progress toward goals and objectives.
Performance indicators (measures) serve as standards for assessing achievement of objectives.
Performance management is distinct from, but linked to, performance measurement; management uses measurement outputs to guide strategic and operational decisions.
Application at the strategic level: tax administrations can apply performance management to align organizational objectives, operational planning, and resource allocation.

Implementing a performance management system involves:
- Developing appropriate performance indicators tied to organizational objectives.
- Establishing data collection processes for continuous monitoring.
- Integrating performance measures into strategic planning and operational plans.
- Using measurement results to inform management decisions and improve tax administration functions.

Subjects:
- Key performance indicators in revenue administration
- Operational planning for revenue administration
- Public financial management (PFM)
- Revenue administration
- Strategic planning for revenue administration
- Tax administration core functions
- Tax audits
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