## The Reform of Tax Administration

_IMF Working Papers, February 1, 1995_

## Source details

**Canonical URL:** [The Reform of Tax Administration](https://www.imf.org/en/publications/wp/issues/2016/12/30/the-reform-of-tax-administration-1180)

## Other formats

- [Markdown version](/en/publications/wp/issues/2016/12/30/the-reform-of-tax-administration-1180/index.md)
- [Structured JSON version](/en/publications/wp/issues/2016/12/30/the-reform-of-tax-administration-1180/index.json)
- [Bundle manifest](/en/publications/wp/issues/2016/12/30/the-reform-of-tax-administration-1180/bundle-manifest.json)

## Bibliographic details
- Authors: Anthony J. Pellechio, Vito Tanzi
- Published: February 1, 1995
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451843941.001

---

### Summary
- Tax administration determines a country’s real (or effective) tax system.
- Many tax administrations do not function optimally and distort the intention of tax laws.
- Effective and efficient tax administration is necessary for taxation to influence the allocation of resources, the distribution of income, and macroeconomic stability and growth.
- The paper addresses tax administration reform by:
  - Describing briefly the causes for inefficient tax administration.
  - Identifying the essential elements of successful reform.
  - Presenting measures to improve the tax administration.
- The common thread of a reform strategy is to focus administrative resources on problems in the tax collection system through:
  - Promotion of voluntary taxpayer compliance.
  - Adoption of a logical sequence of procedures for efficiently identifying and handling instances of noncompliance.

### Causes of Inefficient Tax Administration (as framed in the paper)
- Tax administrations in many countries do not function optimally.
- Such dysfunction can lead to distortion of the intention of tax laws.
- Inefficiencies undermine the intended effects of taxation on resource allocation, income distribution, and macroeconomic outcomes.

### Essential Elements of Successful Reform
- Focus administrative resources on problem areas within the tax collection system.
- Promote voluntary taxpayer compliance as a key objective.
- Implement a logical sequence of procedures to identify and address noncompliance efficiently.

### Measures to Improve Tax Administration (high-level themes from the paper)
- Prioritize problems in tax collection to allocate administrative capacity effectively.
- Encourage taxpayer compliance through measures that reduce barriers to voluntary compliance.
- Design and adopt procedural sequences for detection and resolution of noncompliance to increase administrative efficiency.

### Subject and Keywords
- Subject: Income tax systems, Revenue administration, Tax administration core functions, Tax collection, Taxes, Value-added tax
- Keywords: administration resource, delinquent taxpayer, goal of tax administration reform, Income tax systems, procedures of the home countries, reform of the tax administration, Tax administration core functions, tax administration of a country, tax administration procedure, tax administration service, tax administrations of the world, Tax collection, taxpayer compliance, taxpayer transaction, taxpayers unit, Value-added tax, VAT taxpayer, way taxpayer, WP

---


_Source: https://www.imf.org/en/publications/wp/issues/2016/12/30/the-reform-of-tax-administration-1180_