Technical Notes and Manuals
Technical Notes and Manuals are produced by IMF departments to expand the dissemination of their technical assistance advice. These papers present general advice and guidance, drawn in part from unpublished technical assistance reports, to a broader audience. This new series launched in September 2009.
2010
June 11, 2010
Revenue Administration: Functionally Organized Tax Administration
Description: This technical note analyzes the functionally organized tax administration. The organization structure of tax organizations has evolved considerably over time. From organization structures based on type of tax, to those based on function, to those based on the type of taxpayer, economies of different sizes and at different stages of development have attempted different kinds of organizational reform. This note explains why the choice of an organizational model is so important. The paper also describes key components of a function-based organization.
May 20, 2010
Revenue Administration: A Toolkit for Implementing a Revenue Authority
Description: This technical note presents a toolkit for implementing a revenue authority. This toolkit is a guide with a series of operational modules designed to assist countries when they implement a “revenue authority” to administer their tax and customs operations. It provides a definition of Revenue Authority (RA), a brief history of the concept, terminology, identification of key research documents, and a discussion on increasing autonomy in public institutions. It also presents a review of why countries choose the RA model for their revenue administration.
May 10, 2010
Tax Administration in Small Economies
Description: This technical note analyzes tax administration in small economies. Choosing the right organization structure is a key component of any program of tax administration reform and modernization. It creates a solid platform from which all other enhancements can follow. Organizations and agencies involved in providing advice to governments on modern tax administration have developed principles that should drive decisions on organization structure. This note describes the general principles of tax administration organization. Characteristics of tax administration in small and microeconomies are also elaborated.
April 30, 2010
Conceptual Design: A Critical Element of a Successful Government Financial Management Information System Project
Description: This technical note describes need of conceptual design as a critical element of a government financial management information system project. Governments are increasingly turning to computerized financial management systems to help them respond to the demand for better information. This note describes the conceptual design for government financial management information systems (GFMIS), and explains why is it critical to the success of a GFMIS project. Key factors that influence the preparation of the conceptual design are discussed. The main stakeholders in the preparation of the conceptual design are also elaborated.
Notes: Full text also available in Spanish
April 14, 2010
Revenue Administration: Taxpayer Audit--Development of Effective Plans
Description: This technical note describes how to develop effective plans for a taxpayer audit. The note highlights that a well-managed audit program plays a major role in managing compliance. An effective audit program will have significantly wider impacts than just raising revenue directly from audit activities. The note discusses that a well-planned audit program can provide the administration with significant leverage across the community. The note also describes the value of audit planning, and the methodology for developing an audit strategic plan.
April 14, 2010
Revenue Administration: Taxpayer Audit--Use of Indirect Methods
Description: This technical note examines the use of indirect methods in a taxpayer audit. Indirect methods involve the determination of tax liabilities through an analysis of a taxpayer’s financial affairs utilizing information from a range of sources beyond the taxpayer’s declaration and formal books and records. Assessments are often based on circumstantial evidence indicating a reasonable estimate of the taxpayer’s correct liability. This note describes why tax administrations need to use indirect audit methods. Indirect audit methods commonly used by tax administrations are elaborated. The legislative requirements for the use of indirect audit methods are also analyzed.
April 6, 2010
Role of the Legislature in Budget Processes
Description: This paper examines the role of the legislature in budget processes. The paper highlights that for promoting good governance and fiscal transparency, the legislature’s active engagement in the budget process is essential. When fiscal policies and medium-term budgetary objectives are debated in parliament, budget strategies and policies are “owned” more widely. However, more active participation by the legislature runs the risk that fiscal discipline deteriorates. In countries where the legislature has unrestrained budget amendment authority, parliament is prone to introduce changes that increase spending or reduce taxes.
Notes: Full text also available in Spanish.
February 3, 2010
Reforming Budget System Laws
Description: This paper discusses the need for reforming budget system laws (BSLs). The outcomes of the budget process depend heavily on whether there are clear rules for formulating, executing, and reporting on the annual budget, as well as a clear statement of medium-term fiscal policy objectives. These rules are usually specified in a BSL. This paper analyzes the relationship between the BSL, the constitution, and the wider legal framework. It also discusses how a BSL should be adapted to a country’s political arrangements.
Notes: Full text also available in Spanish
January 27, 2010
A Practical Guide to Public Debt Dynamics, Fiscal Sustainability, and Cyclical Adjustment of Budgetary Aggregates
Description: This paper presents a practical guide to public debt dynamics, fiscal sustainability, and cyclical adjustment of budgetary aggregates. The paper discusses fiscal formulas, which may be of practical use in fiscal analysis. The paper derives, respectively, the formulas for debt dynamics, and cyclical and inflation adjustment of budgetary aggregates. It discusses other relationships for special applications, and some practical implications and usage. The formulas related to debt dynamics are based on the assumption that changes in liabilities are the result of above-the-line budgetary operations.
2009
December 30, 2009
Budget Classification
Description: This technical note analyzes the importance of a budget classification system. It highlights that budget classification is one of the fundamental building blocks of a sound budget management system, as it determines the manner in which the budget is recorded, presented and reported, and as such has a direct impact on the transparency and coherence of the budget. The note describes the main features of a sound budget classification system, structuring of a budget classification system, and the relationship between budget classification and the chart of accounts.
Notes: Full text also available in Spanish.