Digital Transformation Maturity Model

FORUM ON TAX ADMINISTRATION
OECD Tax Administration Maturity Model Series
Digital Transformation
Maturity Model
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Digital Transformation Maturity Model
Updated in September 2022
PUBE
DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

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This document, as well as any data and any map included herein, are without prejudice to the status of or sovereignty over any
territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area.
This document’s first version was approved by the Committee on Fiscal Affairs on 14 December 2021 and prepared for publication
by the OECD Secretariat. The current version has been updated with additional tax administration responses received prior to 12
September 2022.
Please cite this publication as:

OECD (2022), Digital Transformation Maturity Model, OECD, Paris.
www.oecd.org/tax/forum-on-tax-administration/publications-and-products/digital-transformation-maturity-model.htm
Photo credits: © Suppachok N – Shutterstock.com
© OCDE 2022
The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at www.oecd.org/termsandconditions

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Preface
On behalf of the Organisation for Economic Co-operation and Development’s Forum on Tax Administration
(OECD FTA), I am pleased to present the Digital Transformation Maturity Model, a self-assessment tool
for tax administrations to diagnose their current levels of digital maturity, towards more seamless taxation.
This Maturity Model report looks into the practical aspects of respective building blocks of the future of tax
administration, and harnesses industry-specific knowledge from tax administrations and FTA experts.
Each tax administration will have its unique digital transformation journey, given inherently different starting
points, experiences, systems and objectives. For those that more recently embarked on this endeavour,
this Digital Transformation Maturity Model seeks to provide, rather than prescribe, useful guidance and
change management considerations on defining country-specific and achievable digital ambitions. The
forward-looking Whole-of-Society perspectives will also aid early planning and stakeholder mobilisation.
Even for tax administrations already in the thick of digital transformation, periodic health checks to assess
capabilities, processes, and priorities would be useful. Advances in technology and digital tools open
up new opportunities and use cases to address evolving needs. The Maturity Model thus does not replace
existing frameworks but serves as a complementary tool to stimulate discussions within and beyond tax
administrations, on iteratively enhancing roadmap development, prioritising projects, and optimising
resources. The COVID-19 pandemic has also underscored the importance of organisational agility as
many tax administrations have taken on additional roles to support national relief efforts.
This Digital Transformation Maturity Model is one of the first outputs following the OECD FTA’s publication
of the Tax Administration 3.0 Vision last year. It is envisaged as an anchor for knowledge sharing and
capacity building, and provides a reference point for other flagship projects. As Chair of the Advisory and
Drafting Group, Singapore was represented by Evelyn Khoo and her team (Hui Yan Au, Yi Qing Soh and
Edwin Chen). We would like to thank the OECD FTA Secretariat, especially Rex Arendsen and Peter
Green, as well as all members of the FTA’s Advisory and Drafting Group (Canada, Denmark, Finland,
Norway, Russia) and professional expert David Regan for their contributions and support. We also
benefited from inputs from many tax administrations that participated in the pilot, as well as those that
shared their feedback at the various sessions.
Lastly, I encourage all tax administrations to use this Digital Transformation Maturity Model in envisioning
the future, considering or revisiting transformation priorities, and conducting important strategic
conversations.
Ng Wai Choong
Commissioner
Inland Revenue Authority of Singapore

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Table of contents
Preface 3
Executive Summary 5
1. Using the Digital Transformation Maturity Model 7
General background 7
Maturity levels 7
Layout of the Digital Transformation Maturity Model 8
Using the Maturity Model 10
Recording of self-assessments 10
2. Results of Self-Assessments 12
Self-assessment results 12
Self-assessment process 14
3. The Digital Transformation Maturity Model 16

Digital Identity 16
Taxpayer Touchpoints 20
Data Management and Standards 23
Tax Rule Management and Application 27
New Skill Sets 30
Governance Frameworks 35
Glossary of terms 40
Annex A. Digital Transformation Maturity Model: Self-assessment record sheets 42
Process check-list 42
Self-assessment record 42
Record sheet 43
FIGURES
Figure 1.1. The Tax Administration 3.0 Building Block model 9
Figure 2.1. Results of the self-assessment for the thirteen indicative attributes of the model 12
Figure 2.2. Results of the self-assessment for the thirteen indicative attributes of the model 13
Figure 2.3. Self-assessment process: Minimum, average, and maximum number of staff in the self-
assessment group and time taken to complete the assessment 14

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Executive Summary
In general
Maturity models are a relatively common tool, often used on a self-assessment basis, to help organisations
understand their current level of capability in a particular functional, strategic, or organisational area. In
addition, self-assessing and discussing different levels and descriptors of maturity can help an organisation
achieve a common understanding of the type of changes that would be likely to enable it to reach a higher
level of maturity over time.
The Digital Transformation Maturity Model (Maturity Model) contained in this report covers the Tax
Administration 3.0 building block paths of growth and transformation (OECD, 2020[1]). The aim of the Digital
Transformation Maturity Model is to:
• Allow tax administrations to self-assess through internal discussions as to how they see their
currently level of digital maturity. There is not a prescribed optimal level of maturity for tax
administrations. The level of maturity will depend on each organisation’s circumstances, broader
objectives, and priorities.
• Provide staff and senior leadership of the tax administration with a good overview of the level of
maturity based on input from stakeholders across the organisation. This can help in deciding
strategy and identifying areas for further improvement, including areas that require support from
other parts of the tax administration or external stakeholders, including other parts of government.
A number of administrations have reported that cross-organisational conversations when self-
assessing can be useful in joining-up different business areas, helping people see the scope for
synergies and identify areas for mutual support.
• Allow tax administrations to compare their level of digital maturity with their peer organisations. An
administration will know its own level and will be able to compare itself to other tax administrations.
It is also possible for tax administrations to reach out, through the Secretariat, to other tax
administrations at different levels of maturity for peer-to-peer discussion and learning purposes.
This report consists of four parts:

• Chapter 1: Using the Digital Transformation Maturity Model. This provides an overview of the
model and an explanation of how to use the model, including how to get the most out of discussions
within the tax administration.
• Chapter 2: Results of self-assessments. This chapter sets out the anonymised results of the
self-assessments undertaken by tax administrations.
• Chapter 3: The full Digital Transformation Maturity Model. The chapter contains the model
which can be used by tax administrations for self-assessment purposes and, following anonymised
collation of results, for the purposes of international comparisons.

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• The Annex contains a record sheet for internal purposes, including to inform repeat use of the
model from time to time, and for anonymised comparison purposes when submitted to the
Secretariat. (This annex and the Digital Transformation Maturity Model are both available on the
FTA website.)
This Digital Transformation Maturity Model was developed by the FTA’s Tax Administration 3.0 Maturity
Model Advisory and Drafting Group (Canada, Denmark, Finland, Norway, Russia, Singapore), led by the
Inland Revenue Authority of Singapore. It has also benefited from two rounds of pilots undertaken by a
wide range of FTA members and some non-members.
Caveat
Tax administrations operate in varied environments, and the way in which they each administer their
taxation system differs with respect to policy and legislative environments as well as administrative
practices and cultures. A standard approach to tax administration may be neither practical nor desirable in
a particular instance. Therefore, this report and the observations it makes need to be interpreted with this
in mind. Care should be taken when considering a tax administration’s distinct practices to fully appreciate
the complex factors that have shaped a particular approach. Similarly, regard needs to be had to the
distinct challenges and priorities each administration is managing. In particular, not all parts of this Maturity
Model will be relevant for all tax administrations depending on the way that they undertake their digital
transformation journey.

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1. Using the Digital Transformation

Maturity Model
General background
Maturity models are generally descriptive in nature, with a focus on processes and the broad outcomes of
those processes, rather than being heavily based on metrics. This recognises that even where the metrics
chosen may indicate a good or less good outcome, they do not by themselves show how that outcome has
been achieved, the sustainability of the outcome, or its robustness and adaptability to changes in the
external environment.
By their nature, Maturity Models are not prescriptive as to the details of processes nor as to how broad
outcomes should be achieved. There is no one-size-fits-all nor any detailed method that should be
preferred to another in all circumstances. There is also no judgement within the models themselves as to
what the optimal level is for a particular tax administration. This will depend on their own circumstances,
objectives, and priorities.
What the Maturity Model will help an administration assess, though, is where they see themselves as to
their current level of maturity and the kind of processes and broad outcomes they may wish to consider in
order to improve their maturity. In addition, being able to compare themselves to other tax administrations,
or to the average level of maturity of other administrations, can be a useful input to the consideration of
whether the current level of maturity is the right one for them.
Maturity levels
The Model sets out five levels of maturity. The reason for choosing five levels is to help make it easier for
administrations to take a judgement as to their current level of maturity by providing clear distinctions in
the descriptions of maturity levels. This would become more difficult the more maturity levels there are. At
the same time, having five levels helps to ensure that the distinctions between the levels are not so great
that it becomes difficult for administrations to see the pathway to higher levels of maturity.
In designing the Maturity Model, it was decided to use the middle level, termed “Established”, to provide a
description of where, on average, Forum on Tax Administration (FTA) members may be expected to
cluster. Using this as an anchor, the other levels of maturity were fleshed out by trying to describe the
pathway from an “Emerging” level to “Established”, and from an “Established” level to what might be
possible in the future given expected developments. The five levels are:
1. Emerging: this level is intended to represent tax administrations that have already developed to a
certain extent, but which have significant further progress they could make in the area of
digitalisation. The descriptions of this level focus on what is in place rather than on what is not,
while also noting what some of the limitations might be.

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2. Progressing: this level is intended to represent tax administrations which have made or are
undertaking reforms in digitalisation as part of progressing towards the average level of advanced
tax administrations.
3. Established: this level is intended to represent where many advanced tax administrations, such
as FTA members, might be expected to cluster.
4. Leading: this level is intended to represent the cutting edge of what is generally possible at the
present time through actions by the tax administration itself, with some collaboration with
stakeholders.
5. Aspirational: this level is intended to look at what might be possible in the long-term moving
towards more seamless and increasingly real-time tax administration, described in the Tax
Administration 3.0 Vision (OECD, 2020[1]). No tax administrations are expected to be consistently
at this level currently, in particular since in some cases it requires extensive cooperation external
to the tax administration (such as whole of society approaches, access to a wide range of data
sources, extensive use of artificial intelligence (AI) etc.).
Digitalisation and Digital Transformation are important aspects of this Maturity Model. Digitalisation allows
for the substitution of paper-based business processes by digital data processing applications, enhancing
overall efficiency levels. Digital transformation refers to more fundamental changes in the way that tax
administrations operate, responding to the changes in how taxpayers interact and conduct business with
each other. In particular, as described in Tax Administration 3.0 (TA 3.0), (OECD, 2020[1]), this
transformation is centred around the increasing migration of taxation processes into taxpayers’ natural
systems, i.e., the systems they use in their daily lives and/or businesses. These transformational aspects
are addressed in the descriptions of the Leading and Aspirational maturity levels and are related to digital
transformation strategies in those cases.
Layout of the Digital Transformation Maturity Model
The Digital Transformation Maturity Model consists of six main themes. These themes mirror the set of
Tax Administration 3.0 Building Blocks (see Figure 1.1. below):
• Digital Identity
• Taxpayer Touchpoints
• Data Management and Standards
• Tax Rule Management and Application
• New Skill Sets
• Governance Frameworks

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Figure 1.1. The Tax Administration 3.0 Building Block model
Source: OECD (2020)
For each of the themes (building blocks), a high-level descriptor of maturity is set out at the top of the
building block section. To assist in the understanding of a given level of maturity, a set (usually 2 or 3) of
indicative attributes is also contained in each of the six Maturity Model tables. These seek to break out the
elements to be considered when looking at the overall maturity level covering both strategic and practical
aspects.
As shown by the term itself, these are indicative attributes and not determinative. They are, though,
intended to reflect what might be expected, in general form, to be in place at a particular maturity level
which will differ from the level below it (for example, they may be of a different nature, or more demanding).
In addition, tax administrations carrying out a self-assessment should be aware that the examples,
processes and deliverables described at a specific maturity level do not necessarily replace (or erase) all
elements and functionalities from the level before. To distinguish levels, new features and important
differences are highlighted in the descriptions of the ‘next’ level. Therefore, administrations may probably
still recognise valuable legacy elements from earlier stages compared to their current maturity level.
Not all the indicative attributes under a particular maturity level will necessarily be present in a particular
tax administration. A tax administration may also not fit all the elements of a particular attribute.

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Using the Maturity Model
The Digital Transformation Maturity Model is designed to be used as a self-assessment tool. To be

effective, this self-assessment should be completed as objectively as possible. Experience with using the
model suggests the following key considerations for the self-assessment discussion:
• Sufficient time should be allowed for the self-assessment discussion. Feedback from
administrations suggests that concerted discussions may take from a few hours to more than a day
depending on the amount of preparation before the group discussion and the level of detail of the
discussions. Tax administrations may also take time to approach various departments to obtain
comments or confirmation.
• Ideally, there should be a range of staff with responsibilities related to digital transformation
involved in the self-assessment, across grades and functions. Care should be taken to ensure that
the conversations can be frank and open, and people should be encouraged to express their views.
• It can be helpful to ask someone outside of the management chain responsible for overall
management of digitalisation and digital transformation to facilitate the discussions. This person
should have read this note and understand how to process the self-assessment against the model.
As well as facilitating discussions, the person should ideally be able to challenge the views of the
self-assessment group, including asking for supporting evidence where appropriate.
• Consideration should be given to how to reach a view where there is a division within the self-
assessment group on the appropriate assessment of maturity. The facilitator may, for example,
have a tie-break role.
• In addition to the facilitator, consideration should be given to involving staff from various tax
administration functions, ideally at a relatively senior level, to assist in the challenge function and
to provide insights from their different perspectives. A number of administrations have reported that
cross-organisational conversations when self-assessing can prove highly useful in joining-up
different areas of business, helping people to see the scope for synergies and for mutual support
in achieving the administration’s objectives.
Recording of self-assessments
Annex A contains a record sheet for tax administrations to record the results of their self-assessment.
The Maturity Model is intended to cover the broad range of private and business taxpayers. Different
examples in the storylines support this inclusive approach. For testing purposes, participants are advised
to consider this broad perspective. However, if a tax administration prefers, the practical use of the Maturity
Model could be focussed on specific taxpayer focus groups.
We advise tax administrations to only score the indicative attributes. The generic high-level theme
descriptors are intended to assist administrations to better understand the nature and flow of change
occurring across maturity levels.
Most of the indicative attributes are divided into two or three storylines. In self-assessing the maturity level
for that attribute, these storylines should be taken together, and an overall judgement reached based on
the weight attached to the different elements by the administration. An issue that may arise is that the self-
assessment group may feel that it in some cases, a number of storylines of a particular indicative attribute
will be met within a particular theme, for example some “Progressing” and some “Established” story lines.
In that case, the administration should choose whichever maturity level it thinks best describes its current
position given the weight that they attach to the particular storyline(s).

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There is no one-size-fits-all that can work across a large and diverse range of administrations. The
attributes are therefore intended to help guide discussions rather than determine the outcomes of the self-
assessment in a mechanistic manner. In using the model, tax administrations are therefore asked to
consider the best fit for them, taking account of both the indicative attributes and story lines as far as is
practicable.
Annex A also contains a checklist of the considerations for successful self-assessment discussions as
described above. At the end of the record sheet there are also open text boxes to help inform the future
development of the model. When using the model, administrations are asked to identify:
• where they feel that some of the indicative attributes or are misplaced or wrong, or whether there
are important attributes that they think are missing
• changes they think should be made to the descriptions in the Maturity Model (either by noting
comments in comment boxes or by incorporating changes directly into the model using track
change)
• any lack of clarity as regards the difference between adjacent maturity levels
• any areas where it finds the language is unclear or ambiguous or may need to be added to the
glossary.
In order to allow administrations to see where they sit relative to their peers, the results reported to the
Secretariat from the self-assessments will be put into an anonymised form in a heat map, which will be
updated periodically on the FTA website when new record sheets are submitted to the Secretariat.
Administrations are identified by letters within this heat map (with administrations being able to identify
themselves based on their record sheet submission).
The reason for keeping the results anonymous is to help ensure that administrations are not influenced in
their use of the Maturity Model by concerns about external perceptions, and this is intended to reinforce its
primary purpose as a self-assessment tool for informing an administration’s future strategy. Administrations
which wish to speak to peers for knowledge sharing purposes (for example where they are at a “Leading”
or “Aspirational” level) can ask the Secretariat to reach out to that peer for agreement to put them in touch.

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2. Results of Self-Assessments
The Digital Transformation (DT) Maturity Model was tested in a pilot project that involved self-assessments
by tax administrations from FTA and non-FTA countries. The feedback from the pilot test was then
incorporated into the model, which involved the inclusion of an additional term to the glossary and textual
enhancements to the several indicative attributes. This section summarises the results from self-
assessments carried out by tax administrations.
Self-assessment results
The self-assessment record sheets received from 55 tax administrations show that the majority assess the
maturity of their Digital Transformation functions at “Established” maturity levels. This can also be seen in
Figure 2.1. which illustrates the average score for each of the thirteen indicative attributes of the Maturity
Model (in which the Established level is indicated by the digit ‘3’, and Aspirational by a ‘5’).
Figure 2.1. Results of the self-assessment for the thirteen indicative attributes of the model
Source: OECD Secretariat analysis based on participants’ self-assessments.
The detailed results contained in the heat map in Figure 2.2. show how each of the tax administrations
scored across the indicative attributes. The results are anonymised to ensure that administrations are not
influenced in their use of the Maturity Model by concerns about external perceptions.

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Figure 2.2. Results of the self-assessment for the thirteen indicative attributes of the model
Administrations
Indicative attributes
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z AA AB AC AD AE AF AG AH AI AJ AK AL AM AN AO AP AQ AR AS AT AU AV AW AX AY BA BB BC BD
1.1. Creation of digital identity 2 4 2 3 2 2 1 2 2 2 3 2 4 2 2 3 3 3 3 4 3 2 3 3 3 3 3 3 3 3 3 3 3 4 4 4 2 3 4 4 4 3 3 3 4 3 4 4 4 3 4 4 5 4 4
1.2. Uses of digital identity 2 3 2 2 1 2 3 2 2 2 3 3 4 2 2 3 3 3 4 3 3 2 1 3 3 3 3 3 3 3 3 3 3 4 4 4 2 3 4 3 4 3 4 3 4 3 4 4 4 3 3 4 5 4 4
2.1. Types of touchpoints 2 2 2 3 3 3 2 3 2 3 3 3 3 3 2 3 3 3 3 3 3 3 4 2 3 3 3 3 3 3 3 3 3 3 3 3 4 3 3 3 3 3 3 3 3 4 4 3 3 4 4 4 4 4 5
2.2. Accessible services 2 1 3 2 2 2 3 3 2 3 4 3 3 3 2 3 3 3 3 3 3 3 2 2 3 3 3 3 3 3 4 3 3 3 3 3 4 3 3 3 3 4 3 3 3 4 3 4 4 4 4 3 4 4 5
3.1. Availability and standards 2 1 2 3 3 1 2 2 2 2 3 2 3 3 3 2 3 2 2 3 3 2 2 3 3 3 3 3 3 3 3 4 3 3 3 3 3 4 3 3 3 3 3 4 4 3 3 4 4 3 4 4 4 4 5
3.2. Data security and privacy 2 2 3 3 2 3 4 3 2 4 3 2 3 3 3 3 3 3 3 3 3 4 3 3 3 3 2 3 3 3 3 4 3 3 4 3 3 4 3 3 3 4 4 4 4 4 4 4 5 4 4 4 5 4 5
4.1. Tax rule development 2 1 2 2 2 2 2 3 2 2 3 3 2 3 3 4 3 3 2 2 3 2 3 3 3 3 3 3 3 3 2 3 3 3 3 3 3 3 3 4 3 3 3 3 3 3 3 4 4 3 3 4 4 3 4
4.2. Assurance of rule application 2 2 2 2 2 2 2 3 3 2 2 2 2 3 3 2 3 2 3 3 2 2 3 3 3 3 3 3 2 2 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 4 3 4 3 3 3 4 3 3 4
5.1. HR strategy and function 2 1 2 1 2 2 1 2 3 2 2 3 2 2 3 2 2 2 2 2 2 3 2 4 2 2 3 3 3 2 3 2 3 2 3 3 4 3 3 3 3 4 4 3 3 3 3 2 2 4 3 2 4 5 4
5.2. Skills development 1 2 1 2 2 2 1 2 2 3 2 3 2 2 3 3 2 2 2 2 3 3 3 3 2 2 3 3 4 5 3 3 3 3 3 3 3 3 3 4 3 3 5 3 3 3 3 3 2 4 4 3 4 4 5
5.3. Workforce planning 1 3 1 1 2 2 1 2 3 3 2 3 2 2 2 2 2 2 2 2 3 3 2 3 2 2 2 3 3 3 3 3 3 2 2 3 4 3 3 3 3 3 2 3 2 2 3 2 2 4 4 3 4 5 5
6.1. Strategy setting 2 2 2 2 2 2 3 2 3 2 1 2 2 3 3 2 2 3 3 3 2 3 4 2 3 3 3 2 3 2 3 3 3 4 3 3 3 3 4 3 4 3 3 4 4 4 4 3 4 3 4 4 3 4 4
6.2. Governance mechanisms 2 2 2 1 2 2 3 2 3 2 2 2 2 3 3 2 2 3 2 2 2 3 3 2 3 3 3 2 2 3 3 2 3 3 3 3 3 3 3 3 3 3 3 4 3 3 3 3 4 3 3 4 3 4 4
Heat map key: Emerging 2 Progressing Established 4 Leading 5 Aspirational

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The heat map shows that the “Established” level was chosen in 52% of possible instances followed by
“Progressing” with 26%. In 17% of the cases, administrations chose the “Leading” level, in 3% of the cases
“Emerging”, and only in 2% of possible instances, administrations chose “Aspirational”.
Those results are in keeping with the expected clustering around the “Established” category when the
Maturity Model was built. Therefore, for the time being there is no need to adjust the model. However,
some pilot participants suggested changes that might be fed into future model versions, e.g. with respect
to business agility and organisational culture. Many administrations are in the process of implementing and
upgrading their Digital Transformation function and capabilities, therefore, it is expected that
administrations will self-assess at a higher level of maturity in the near future. Keeping the current
calibration will allow the maturity model to remain unchanged in the medium term. However, when more
tax administrations self-assess themselves at higher levels of maturity, the model may need to be re-
calibrated and adapted to new challenges and circumstances.
Self-assessment process
The feedback received during the pilot process indicated that for the majority of the participants, the model
was easy to use, covered the right areas and that the jumps in maturity levels were sufficiently discrete
and understandable. Some participants reported that they faced challenges in choosing the best fitting
maturity score regards specific indicative attributes, especially where they perceived their tax
administration was at a higher level for part of the definition than another part. Chapter 1 provides some
guidance on how a best fitting score can be established. Some changes to language were suggested in a
few of the indicative attributes and these have been made in the final version of the model in Chapter 3.
As mentioned in Chapter 1, experience with using maturity models suggests administrations might wish to
take into account a number of considerations for the self-assessment discussions, including involving a
range of staff with digitalisation and change management responsibilities, across grades, and involving
staff from other tax administration functions, such as human resource management and technical experts.
Record sheet submissions from tax administrations show very diverse approaches as regards the self-
assessment process. As can be seen in Figure 2.3., the number of digital transformation staff in the self-
assessment group ranged from one (1) to sixty (60) with administrations involving twelve (12) digital
transformation (DT) staff members on average. More than 91% of the administrations indicated that they
had an appropriate distribution of grades within the discussion groups, and 93% noted that they involved
official(s) from other areas of the tax administration. In addition, almost two-thirds (62%) of the
administrations indicated using a facilitator to lead the discussions.
Figure 2.3. Self-assessment process: Minimum, average, and maximum number of staff in the self-
assessment group and time taken to complete the assessment
No. of DT staff in self-

assessment group
Time taken to complete the

self-assessment (in hours)
0 20 40 60 80 100 120 140

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Figure 2.3. also shows the time it took administrations to complete the self-assessment including the
preparations for the group discussions. Again, there are significant differences among participants with
administrations taking as little as one (1) hour to complete the assessment to as much as one hundred
and twenty (120) hours. The average time taken to complete the self-assessment was twenty-four (24)
hours.
Understanding that many administrations involved a significant number of staff and spent many hours in
the group discussions, it will be interesting to review in due course what administrations report about the
impact of the maturity model on their digital transformation journeys.

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3. The Digital Transformation Maturity Model
The Digital Transformation Maturity Model consists of six main themes (building blocks). This chapter presents detailed descriptions of each of these
themes. Each section starts with a short theme description and a characterisation of the path of growth. Subsequently, a matrix presents the interrelated
set of storylines.
Digital Identity
The secure identification of taxpayers is key to the efficient functioning of modern tax administrations, allowing the matching of administration processes
(communication, tax return filing, incorporation of other data sources, self-service options, etc.) to individual and business taxpayers.
To facilitate the identification of individuals and businesses that are, or may be, subject to tax obligations, tax administrations put in place registration
processes and databases, also called registers. To ensure the accuracy of the registers and to streamline internal digitised processes across the
administration, in particular matching data to taxpayers, jurisdictions started issuing tax identification numbers (TINs) or equivalent unique identifiers.
With technological advancements resulting in an increasing taxpayer demand for the delivery of services through digital means, tax administrations
have to consider how to ensure the secure identification of taxpayers in the digital world. For this purpose, tax administrations started creating more
complex digital identities of their taxpayers to allow them to access a range of digital services, for example, through taxpayer portals.
Digital identities provide wider opportunities than just in tax administration. They enable different parts of government and third parties to work together
in a secure, convenient, and trusted manner and allow the same digital identity to be used in interactions, both domestically and across borders. As a
result, an increasing number of governments are putting in place government-wide digital identity strategies, encompassing a large variety of government
services, and tax administrations have an important role to play in this.
Mirroring the Tax Administration 3.0 Vision (OECD, 2020[1]), the Digital Identity path of growth presented in the matrix below can be characterised
as:

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• increasingly adopting a “tell us once” approach by moving from tax administration specific and less secure identification methods to highly
personalised and information rich digital identities which can be used for secure processes across government, and eventually, the whole of
society;
• expanding support of orchestration of taxpayer centred processes like filing and reporting processes and an ecosystem approach towards
payments, benefits and refunds from a citizen and business perspective; and
• enhanced interoperability between solutions and solution providers supporting secure and unique identification of taxpayers and citizens in a
joined-up way, helping to reduce burdens and move processing into the background, connecting taxpayers’ natural systems.
Digital Identity Emerging Progressing Established Leading Aspirational

Identity as a taxpayer is For the majority of taxpayers, More complex digital Individuals can use their Whole of society digital
established by the tax the administration creates identities are created by tax digital identity to unlock identity is being developed
administration through the basic digital identities which administrations to access services in different roles and implemented, allowing
Descriptor verification of documentary include TINs. Taxpayers are online services. TIN and and (business) contexts. for comprehensive joining-
evidence. A TIN is created to provided with credentials password are no longer the There is a shared digital up across the public and
identify the taxpayer for (often TIN and a password) only attributes to identity vision across private sector. Digital identity
internal tax administration which enables access to authenticate taxpayers, as a government as well as supports taxation processes,
processes which remain basic self-service options range of attributes are increasing collaboration with including secure (near) real-
largely within silos. There are and communications combined to create a more private sector partners. time tax accounts, which are
very limited options for self- between the administration secure access to the digital Digital identity supports a embedded into taxpayers’
service, although electronic and taxpayer, including identity allowing the wide range of public/private natural systems. The digital
submission of forms is online filing and payment. administration to provide service delivery and identity system is designed
increasingly possible. The administration is using more self-service options. exchange of data. While the to facilitate international
TINs to improve the digital Digital identity has become a tax administration still interoperability, supporting
joining-up of data within the key enabler of joined-up tax centralises some data, seamless usage of a digital
administration as well as administration and increasingly taxation identity in different
engaging with other parts of governmental processes and processes are built into public/private contexts and
Indicative Attributes government on data sharing taxpayer self-service. taxpayers’ natural systems, responsibilities.
options. making transactions more
convenient and increasingly
seamless, enabled by secure
digital identity.
Creation of digital Taxpayer registration and Identification for some Taxpayer registration and the Digital identities created by The digital identity system
identity and the issuance of a TIN is generally taxpayers is increasingly creation of a digital identity is other government agencies, gradually facilitates the creation
done on a reactive basis supported by sending scanned generally a digitised process for which may be triggered by of an entire ecosystem offering
following submission of identification documents, but individuals in employment and other life events, can be used a suite of identity services (e.g.

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unlocking of service appropriate forms and proof of still requires a degree of is increasingly a condition of for tax purposes by the authentication, retrieval of
options. identity by the taxpayer. manual checking of documents business registration. The administration. Taxpayer information, electronic
Registration forms are within the administration. administration engages with registration is increasingly signature). As whole of society
available in printed format, Individuals and entities are online platforms, trade carried out seamlessly for most digital identity develops, a
although some forms may be increasingly prompted and associations and other parts of taxpayers, for example, when whole of government digital
available for download on the guided to register for tax government on the promotion they first undertake taxable identity system is in place
administration’s website. following certain trigger events, and prompting of tax transactions, enter allowing taxation processes to
Registration is usually done in such as registration as a registration. Verification of employment, register a be built into taxpayer’s natural
person or by mail, although for business or for employment. electronic documents and business, or enter the systems. This digital identity
some classes of taxpayers Taxpayers are increasingly issuance of a digital identity is jurisdiction for work purposes. (or compatible digital identities)
online registration may be issued with a TIN and possible in near to real-time. The tax administration is fully can also be harnessed by
possible. A Tax Identification password on the same day. Enrolment processes for digital engaged with the development approved private sector
Number (TIN) may take a Engagement is starting with identities are increasingly and implementation of a organisations and can work
number of days to issue. TINs other parts of government on joined-up across government strategy for whole-of- seamlessly across borders
are generally used only in tax how and where government agencies, bringing together government digital identities, where counterparts have
administration processes and registration processes and government-held information, which is a key enabler to allow adopted internationally
communications, and different issuing (and use) of for example population for an array of digital compatible digital identity
identification numbers are used identification numbers can be registers, passports, or social interactions between taxpayers standards.
across government and the more joined-up (for example security records through and tax administration as well
private sector using common databases or digitised processes within a as third parties (e.g., financial
linkages between existing legal framework. intermediaries).
registers).
Most interactions with the tax Some digital services can be The TIN and password is no The attributes associated with Taxpayers have a high degree
administration remain paper accessed by using TINs and longer a single digital identifier, digital identity can be of control over their digital
based and, depending on the passwords, although these are and a wider set of attributes harnessed by trusted public identity. This includes the ability
degree of risk of fraud, may generally limited to submission (connected identifiers, and private organisations. to choose specific data to share
require the submission of of information to the tax characteristics and credentials) These attributes include from their digital profile, verify
further proof of identity, for administration. More risky are connected together to enhanced security measures, their ID, authorise the sharing
example through the sending of processes, such as requests securely represent the digital such as biometric information, of data, including to update
witnessed documents or for refunds, change of personal identity of a person or entity. and are transparent to attributes in real-time, and
presentation of credentials at details and delegation of This enables a wide range of e- taxpayers. A public/ private securely transact more
the tax office. authority, cannot be carried out services to be accessed control framework is seamlessly. Taxpayers can
online. Delegation to carry out directly by taxpayers. established, allowing taxpayers easily switch (private and
actions on behalf of the Applications to delegate certain to manage their digital business) roles within the tax
taxpayer can be authorised actions to real persons (e.g. identities, including delegations system, using the same
through online application relatives or tax practitioners) to authorised representatives personal digital ID. This
processes. can increasingly be carried out and the operators of natural societal secure digital ID

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online. systems. enables the orchestration of
societal processes into
seamless customer
experiences.
Uses of digital identity TINs are used to identify TINs are increasingly used to Taxpayer data linked by digital Digital IDs, which are used The tax administration is fully
within the administration taxpayers within the different join up individual taxpayer identity is immediately across an increasing number of embedded in a whole-of-
and by taxpayers tax administration functions, information across different accessible to all tax government agencies and society system of digital identity
although taxpayer data remains administration functions, administration functions some private sector actors, (whether unique or compatible
within silos in general. Data can improving the efficiency of (subject to any legal restrictions allows for the bringing together digital identities). The tax
be accessed from other processing within the on use and internal controls on of increasing amounts of tax administration has a real-time
functions on request using the administration and helping to access to data). Digital IDs relevant data within the holistic picture of the taxpayer,
TIN (which is the identifier used drive improvements in the use increasingly allow the links to administration, This data is taxable events, and their
across the administration). This of analytics and compliance be made between taxpayers increasingly available in real- natural system touch points.
scattering of taxpayer risk management. Not all when they are acting in time rather than following This also allows the tax
information can lead to delays systems are fully integrated, different capacities (such as for periodic reporting cycles. administration to adequately
for the taxpayer, for example as though, so there is not a single themselves or on behalf of These integrated digital identity find, service and tax entities
regards refunds and closure of picture of a taxpayer available entities), and allows a fuller risk functions enable tax and persons abroad. Where
tax positions, as well as to all tax administration picture to be built based on administrations to service taxation processes are built into
duplication of reporting in some functions in real-time. connections to other taxpayers. taxpayers from a more holistic taxpayers’ natural systems,
cases. perspective. digital access is available to the
tax administration for proactive,
personalised assurance
processes, supported by the
use of artificial intelligence.
Self-service offerings, which Basic digital identification gives A wide range of digital taxpayer Digital identity supports Increasingly real-time taxation
can be accessed through the taxpayers access to a portal/ services, including for refunds taxation processes being processes are embedded in
TIN and an account password, platform allowing them to view and amendments of taxpayer embedded within some taxpayers’ natural systems for
are generally limited to viewing personal information or notices information, can be unlocked taxpayers’ natural systems, in all taxpayers, with digital
basic identity information about from the administration and to using digital identities and more particular for elements of identity supporting the real-time
the taxpayer. The taxpayer can increasingly interact digitally secure authentication personal income tax and small exchange of information from
query the information with the tax administration (for processes, such as multi-factor business taxation, although the all relevant parties necessary
electronically in some cases, example for reporting, payment authentication. A legal administration continues to for such processing. Tax-
but is unable to amend it and some verifications). framework is in place for centralise large amounts of relevant data is sent from
directly. The administration is Passwords to access the portal allowing two-way sharing of data for the processing of tax taxpayers’ natural systems to
starting to develop a strategy are sent by mail to the information across government liabilities and risk assessment. the administration when

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for the expansion of digital taxpayer’s registered address and some private sector actors, Taxpayers can use their digital taxable events occur, allowing
identification and self-service and have to be used along with but this is not yet fully IDs to access up-to-date the taxpayer to have an up-to-
options for taxpayers. the TIN. For security reasons, operational due to lack of information across many date understanding of their
limitations or exclusions are in compatibility across digital IDs. government and some private current tax position. Overall,
place for some processes to be sector platforms. Taxpayers trust drives taxpayers’ adoption
done in real-time such as can increasingly use biometric and use of joined-up/ integrated
changes of details, refunds or and other authentication digital identity enabled
viewing of some records. methods built into their natural services.
systems.
Taxpayer Touchpoints
Communicating, interacting, and facilitating engagements with taxpayers is core to the smooth running of tax administration. This is managed and
supported through a number of touchpoints, varying from: face-to-face interactions, phone calls, multifunction websites, e-services, to business
management systems etc. These taxpayer touchpoints help to resolve friction where it arises, for example due to lack of understanding, unusual
circumstances that require further discussion with the administration, processes not working as they should etc. Advances in digitalisation allow tax
administrations to improve existing taxpayer touchpoints or to create new ones. Over the past years, many FTA member administrations have introduced
new e-services, ranging from integrated taxpayer accounts to mobile applications and digital mailboxes. Touchpoints can also be embedded into
taxpayers’ natural systems allowing them to have a more seamless experience, with taxation processes becoming a more integrated part of daily life
and doing business, thus fundamentally changing taxpayer engagement with the administration. Key enablers for achieving such integration include
(open) application programming interfaces (APIs) which allow applications developed by third parties to digitally interact with the tax administration
systems without providing direct access.
Mirroring the Tax Administration 3.0 Vision, the Taxpayer Touchpoint path of growth presented in the matrix below can be characterised as:
• moving from paper-based via websites and portals towards seamless integration into taxpayer natural systems;
• shifting from re-active to responsive and pro-active taxpayer engagement support; and
• continuous enhancement of awareness and abilities to support inclusiveness and accessibility.

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Taxpayer Touchpoints Emerging Progressing Established Leading Aspirational

General information and A professionally designed Taxpayer portals and direct Taxpayer accounts and In most cases taxpayer
Descriptor downloadable forms are website and call centres are connections with business embedded functions in touchpoints are fully
provided on the the primary means of management systems are business software are integrated into taxpayers’
administration’s website, interaction with the tax increasingly used, with e- increasingly a one-stop-shop natural systems with an
although this can be difficult administration. Some self- services available for the for interaction with the tax increasing use of AI to assist
to navigate and may not be service options for e-filing main interactions with the tax administration. The number in dealing with ambiguities
regularly updated. Many and payment are available, administration. Personalised of tax administration and anomalies. Taxpayer
interactions can only be although many interactions interactions are increasingly processes and related touchpoints are increasingly
performed through tax still require paper or in- done electronically, and the touchpoints capable of being usable in cross-border
offices and/or on paper. person contacts. use of self-service solutions integrated into taxpayer situations.
Indicative Attributes is growing. natural systems is
increasing, as a suite of APIs
has been developed.
Types and uses of The tax administration website The main taxpayer touchpoints The primary individuals’ The primary taxpayer Taxpayer touchpoints are
taxpayer touchpoints contains general information on are the administration’s website taxpayer touchpoint remains touchpoints are contained incorporated within taxpayers’
tax obligations, although this and call centres. The website is the administration’s website within taxpayer accounts which natural systems. This provides
may not be regularly updated. professionally designed and although there is increasing can also be accessed from for increasingly seamless
An increasing number of forms contains all common forms use of personalised one-stop solutions (e.g., mobile interaction, which for most
are available for downloading. needed by taxpayers, which communication using email and applications and cloud-based taxation processes is done on a
Some information can be can be downloaded and sent by texts as well as through business management suites, machine-to-machine basis,
obtained on request over the electronic means. A wide range taxpayer portals and web chat etc.) and increasingly use including increasingly across
phone, but the primary channel of guidance is available on the facilities. Businesses in most native features of the relevant borders. This includes relevant
for taxpayer engagement is the website. Digital facilities for cases can file VAT and salary devices (such as cameras, updates affecting taxpayer
local tax office, including for the voluminous e-filing from tax returns digitally, often via reading of QR codes and status, for example changes in
filing of most tax returns and business systems are business systems interfaces biometrics). Taxpayer accounts income, taxable status, tax
payment of tax. becoming available. However, (like API’s). Call centres remain contain up-to-date information rates, and rules. Real-time
Communication with taxpayers for less usual cases it is in use, although there is a on tax assessments as well as settlement options are
is generally done by letter, necessary to communicate with strategy to shift taxpayers to general and personalised available for most tax liabilities.
phone, or physical interactions. the administration outside of self-service channels. communications. Self-service Options for human interaction
the website. Taxpayers can complete most channels supported by real- remain and are transparent and
routine processes such as time assistance (such as. chat easily accessible.
filing, payment, and bots) are increasingly used
applications online. across the administration,
some supported by artificial
intelligence.

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The design and content of the The administration has a The administration has a The tax administration The design and implementation
administration website is done strategy to increase the strategy to understand and publishes a library of APIs of tax administration
by individual tax administration availability of e-forms which develop taxpayer touchpoints covering a wide range of touchpoints is an integrated
functional areas rather than can be processed online, some based on analysis and administration functions to part of societal systems’
across the tax administration as of which are already available. feedback from taxpayer increasingly enable taxation development processes (i.e.,
whole, and it is not always Electronic payment options are groups. Some self-service and processes and related omni-channel). Artificial
regularly updated or cross- increasingly supported. The tax pre-filling solutions have been touchpoints to be incorporated Intelligence (AI) support is
checked. administration creates and developed, whether by the into taxpayers’ natural systems increasingly integrated into
distributes standards enabling administration or by external (i.e., multi-channel). This also taxpayer touchpoints. This
digital interfaces with business developers using some APIs enables joined-up services with provides prompts and
management systems. made available by the other government websites and recommendations for actions
administration, in particular for applications, supporting the taxpayer may wish to take,
filing of PIT, CIT and VAT options for real-time transaction information they may wish to
returns and communications. processing based on insights review, and highlights possible
gleaned from whole-of- mistakes and options for
government customer journey obtaining further information in
mapping. complex cases.
Accessible services Taxpayers can generally All digital services are still Digital accessibility has Digital accessibility is a Because most taxpayer
access services or request available via paper supported become part of the tax cornerstone of the tax services are part of taxpayer
assistance/consultation processes. Therefore, no administration’s touchpoint administration’s digital service natural systems, accessibility
through tax offices. Few formal specific digital accessibility strategy. Governmental and implementation strategy. For by design is generally assured,
facilities are available for measures are implemented. societal frameworks guide the business taxpayers a suite of Where it is not yet possible to
taxpayers without the ability to Website design does not have design of user friendly and self-service solutions (e.g., incorporate all touchpoints into
read or for those without a open support for the visually accessible digital services user friendly apps, software taxpayers’ natural systems,
computer and internet; a lot of impaired. Some remote service although requirements are not tools and webforms) is advanced analytics and
assistance is de facto provided support is available to met in all cases. Special available. All digital services behavioural insights are used
informally and may not be taxpayers without access to interest is given to specific align with open international to prompt and assist with the
consistent nor high-quality. digital channels or who have taxpayer groups who struggle accessibility standards. flow of relevant information in
special circumstances, to use digital services. This Specific interest groups are the light of the taxpayers’
including through call centres includes the continued support serviced in close cooperation circumstances and
or within the tax office. of paper processes and the with public and private preferences.
engagement with government stakeholders, thus assuring a
advice centres, civil society, growing alignment with
and informal networks. taxpayer natural systems,
including those of a non-digital
nature.

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Although most services are The administration culture is The tax administration has Tax administration works to the Tax administration, like other
being delivered at the tax office increasingly focused on adopted a customer-centric principle of taxpayer-centric parts of government, is focused
by tax administration staff, supporting taxpayers. approach, although this may design. ‘The human in the loop’ on reducing burdens on
there is no formalised client- Taxpayer dispute and not be consistently recognised is a key design and fall-back citizens through the
centred culture in place, and complaints processes are not by taxpayers. The majority of principle of all digital services introduction of seamless
there is limited flexibility to supported digitally. Errors in appeal and objection implemented. Compliance by services and processes,
respond to difficult cases. In digitally filed forms generally procedures are digitally design solutions help diminish meeting or exceeding
case of disputes or process have to be corrected via paper supported, and both case and errors and disputes. More accessibility standards. In all
flaws, taxpayers can processes. Tax administrations progress information can be complex cases are being circumstances taxpayers can
experience challenges while start to digitally facilitate tax accessed via taxpayers’ identified and addressed at an intervene and challenge tax
trying to exercise their legal practitioners in their support of personal portals. Taxpayers early stage and settled via administration processes and
rights. taxpayers, e.g., by offering who want to address specific human intervention if needed. decisions; in most cases via
email facilities and specific call complicated issues may run natural systems touch points
Tax practitioners are still an
centre options. into problems in respect of and trusted third parties. AI-
important channel for some tax
standardised digital PIT and augmented systems support
administration services,
VAT processes. Tax both taxpayers and tax
although there are a growing
practitioners are being administrations in jointly
number of pre-filled services
supported by a suite of digital creating upstream tax certainty
and integrated cloud-based
services. and the prevention and
business systems.
settlement of disputes.
Data Management and Standards
Tax administration is, at its heart, a data processing operation heavily reliant on the availability and quality of data. With increasing digitalisation, more
tax related data from taxpayers and third parties has been increasingly taken in to the tax administration and processed (for example data from e-
invoicing, online cash registers and financial account information). To maximise the value of the data, tax administrations have at their disposition, they
also need to consider how to share it effectively and responsibly with other agencies and ecosystem partners. While transforming, the location of the
data (which can be in business systems, the cloud, third parties etc.) is driven by the objective of using taxpayers’ natural systems rather than requiring
the development of new systems. As more interconnections between natural systems becomes possible, taxation processes can increasingly be
incorporated within taxpayers’ natural systems.

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Mirroring the Tax Administration 3.0 Vision, the Data Management and Standards path of growth presented in the matrix below can be characterised
as:
• moving away from centralised bulk data processing to more taxpayer centred, granular and real time data processing;
• shifting from managing and storing the data towards increasingly managing the availability, quality and accuracy of data to be drawn remotely
from taxpayers’ wider natural systems, subject to taxpayers’ consent;
• increasing awareness, monitoring and prevention of data security and data privacy breaches; and
• adopting open and global standards in facilitating interoperability and data re-usage.
Data Management and Emerging Progressing Established Leading Aspirational

Standards
Data management processes Data management processes The administration has a The administration’s data Increasingly taxation
are carried out within tax are centrally defined, and joined-up data management sources cover most tax processes are embedded
administration functions most data is stored in digital system which can be relevant information and are within taxpayers’ and third
rather than centrally, leading form, including some third- accessed and updated by all increasingly entered directly parties’ natural systems with
to inconsistences in the use party data. Not all functional administration functions. into administration systems assurance processes built
Descriptor of data and data standards as systems within the Data exchange standards are via machine-to-machine into those systems as well as
well as issues with data administration are able to in place, and the processes, such as APIs. options for tax
quality. Some parts of the access all administration administration has access to While bulk data is still used administrations to carry out
administration are more databases, leading to some an increasing number of by the administration in remote audits supported by
advanced in their use of fragmentation and data government and third-party some processes, more AI. Increased use of global
digital data, although there quality issues. Data analytics data sources, including bulk attention is being given to open standards reduces
remains a lot of paper-based is increasingly used to data. A data quality the incorporation of tax taxpayer costs and provides
processing. Training in data support risk assessment and framework is in place. processes into taxpayers’ for more seamless cross-
protection is provided, but auditing. Data protection is Increasing use is made of natural systems. AI is border taxation processes.
implementation in practice is taken seriously throughout analytics to support increasingly used to support Taxpayer trust in the use of
patchy. the administration, although administration capabilities. analytics processes. data is enhanced by
there are some known First aspects of data security Taxpayer data access and taxpayers’ ability to
weaknesses in application. are digitised, with data use are continuously understand the use of data
Indicative Attributes access and usage partially monitored by digitised tax and to allow or restrict
logged and monitored. administration systems with access. AI is increasingly
real-time flagging of issues. used to prevent
unauthorised data use in
real-time.
Data management is generally A common data management Both internally and externally Most taxable income is Substantial amounts of tax
done within each tax function system has been developed, generated data on individual reported to the tax administration relevant data are

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Standards
Data availability and according to their needs and although not all systems are taxpayers are contained in a administration, supported by a based on real-time outputs
standards available resources, although connected to it and ad hoc central database or connected suite of APIs, and data can provided to the administration
high-level identification and exchange of individual data and databases and is digitally increasingly be entered directly from taxpayers’ natural
final tax liability information is data sets is still required in available to relevant tax into relevant tax administration systems (subject to taxpayers’
generally consolidated on a some areas, leading to issues administration functions to systems, in many cases consent). The administration
central database. Significant with the quality of data across support service delivery, audit, providing an up-to-date and has primarily adopted an
amounts of data remain in the organisation (in particular and enforcement processes as holistic view of taxpayers and oversight and assurance role
paper format, although some outdated information) which appropriate. New information tax liabilities. While bulk data is regarding this data, with the tax
functions are using databases. leads to difficulties in matching. automatically updates the still processed within the administration increasingly co-
Tax administration officials will Different IT systems or database(s), and changes are administration to determine tax managing the framework for
often manually update and programmes are used by logged so that prior information liabilities and for risk the availability, quality, and
combine different databases different functions, and data can be recovered. A assessment purposes, an accuracy of taxpayers’ systems
while addressing taxpayer- accessibility data across transparent set of (tax type increasing number of tax in a public/private partnership.
centred issues (such as different systems or specific) data exchange administration processes are Bulk (transaction) data
registration, record keeping programmes can be an issue. standards has been being incorporated into exchange from taxpayers’
and audits). Data quality is not Data standards for quality and implemented, and taxpayer taxpayers’ natural systems. natural systems is still being
monitored consistently across availability have been declaration data can in most supported in specific cases
the administration, nor developed, although they are cases be directly integrated into where burdens are minimal.
enforced centrally. not yet consistently tax administration databases. The need for centralised
implemented. internal databases beyond the
outputs of taxpayers’ natural
systems and digital identity
information is much reduced.
While information from large All employers are required to In addition to data received Where applicable, tax Tax administration has become
employers on employee send data on employee income from employers, an increasing administration- determined an integrated part of
income and some other third- to the administration. Some range of third party and wider standards are increasingly governmental services and
party reporting is received in implementations of third-party government information is being substituted by industry processes, using and
standardised formats, there is data exchange are in place, being received in standard agreed standards for data managing joint data sources.
no systematic process for with banks and some domestic formats, enabling increased capture and quality assurance, Taxpayers can check and
entering data into tax governmental bodies using pre-filling by the administration making it easier for processes query the origin and accuracy
administration systems, and standard formats. A strategy is of parts of tax returns. Some to be incorporated into natural of the data used and can grant
significant manual work is in place to increase the regular bulk exchange of systems and reducing data or deny access to personal
required to check and input availability of third part data. information is in place under quality issues. A network of data sources not needed for tax
data. First data exchange with Data management is being international standards interdependent generic purposes. Global open
some domestic governmental standardised, generally although it is mainly used for governmental databases standards are increasingly
organisations is emerging, in allowing for smooth integration risk assessment rather than support taxpayer-centred being used to reduce

26 |

Standards
most cases on an ad hoc and of external data into tax capable of being integrated into service delivery, e.g., pre-filling, administrative burdens for
audit-triggered bases, e.g., administration systems and tax calculation processes. benefits programmes, job businesses.
related to personal and identification of data quality Some data quality issues are transitions and debt
business identity and property issues, which still often requires present (e.g., inconsistent data, management. There is public
registrations. manual intervention to rectify. incomplete fields, human error transparency on which data
etc.) and data cleansing activity sources have been used by
is carried out, increasingly on which organisation.
an automatic basis.
Data security and privacy The administration’s IT Risks of electronic data Regulatory and procedural Privacy and data protection by Enhanced reliance on trusted
systems are not updated with breaches are more significant requirements govern the way in design assure data quality and outputs rather than bulk data
the latest security protocols and as most taxpayer data are which data security is being integrity and minimise data from taxpayer systems reduces
standards. Much of the data available in digital formats and managed both structurally and leakages. Any breach of data data exchange leakage risks,
exchange with taxpayers and data exchange is being as regards incident protection will be subject to although the administration will
storage of taxpayer information broadened to external parties. management. Data privacy and internal audit and, where still retain information about tax
is paper based. Data protection Mitigating data security security are an important part of necessary, systems changes paid by taxpayers (as displayed
is part of the technical training measurements focus on on-boarding programmes, are made as a matter of in taxpayer personal accounts).
programmes done by ICT logging and granting access to management, and risk urgency. A strong data There is a strong data
specialists and database devices and databases. management training. Chief protection culture, as well as protection culture at all levels
managers. Mitigating safety Training programmes include Data Privacy and Security transparency mechanisms within the administration as well
and security measures are awareness for data privacy and Officers nurture awareness and around the use of data and as within the entire ecosystem.
being integrated into paper- security risks. A data protection culture. Data breaches have to privacy protections, support Data ownership and privacy
based and postal processes. culture is developing, fuelled by be reported to senior public trust in data (re-)usage assurance frameworks, as well
the growing importance of data management and relevant data and exchange. This is as transparency and
and data management regulators, together with plans supported by private systems permission mechanisms
functions, both internally and for addressing the underlying facilitating personal and nourish societal trust. This is
within wider government. causes and learning lessons. business data governance and coupled with a strong
permission management. internationally accepted AI
ethics framework to facilitate
any testing and development
with international partners,
where appropriate.
Poor data security Identification and access Control and management Cybersecurity tools and best There is real time management
management is often observed management requirements and measures for secure storage practices have been adopted to of data protection risks through
increasing the risk of data leaks procedures are documented and logged access to data continuously monitor the use of AI enabled systems; these
or the alteration of data. For and communicated to relevant assure confidentiality and data data and the identity and ensure that data cannot be
example, there may be little staff but there may be integrity. These are subject to permissions of data users to accessed or used without

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Standards
training or monitoring of weaknesses in oversight and regular checks and prevent data breaches. appropriate consents and
ongoing security issues leading patchy adherence to standards. comprehensive testing by the Coverage of security testing which automatically restrict
to the regular sharing of It is generally possible to trace data protection professionals. has expanded to assess access to data and issue real-
passwords, unattended files or access and changes to data to Disclosure standards, security efficacy and identify time reports to management
not locking computers during identified individuals. However, regulations and policies are vulnerabilities in systems in a when potential misuse of data
breaks. As a result, incidental unauthorised transfer of data being established to ensure timely manner to improve is identified.
and targeted data leakage may (for example to an external that security and data risks are detection of anomalous activity. Security controls and principles
occur and are hard to signal drive) is not automatically well-managed and allow for Where access to or use of data are embedded in multiple
and trace. prevented or detected. timely detection of data breach goes beyond permissions, this layers of the technology
incidents or any cybersecurity is flagged in real-time as a architecture in order to improve
threats. However, there may potential breach and integrity cybersecurity resilience beyond
still be some weaknesses, risk to management and data incident prevention. This is
particularly when staff are protection officers. Standard supported by collaborations
working remotely (e.g., use of operating procedures are in with various public, private, and
unsecure email, papers not place (e.g., incident reporting, international stakeholders to
secured). mitigation measures, business create a safer cyberspace.
continuity plans) to allow for
swift responses and accurate
updates
Tax Rule Management and Application
Currently tax rule management and application is primarily undertaken within tax administration-driven or supported processes. This usually involves a
number of steps including guidance on tax law compliance and deadlines, the use of forms and e-forms which require the input by the taxpayer of
specific tax relevant information, and the finalisation of the relevant processes within the administration (for example, the registration of the taxpayer,
computation of the final tax liability, acceptance of payments etc.). Digital transformation of tax administration will enable a more decentralised and
distributed way of rule application, supporting upstream compliance and the provision of tax certainty at an earlier stage. Creating and distributing tax
laws in administrable and verifiable formats allows for stakeholders to integrate tax rules within their own preferred systems, including as they evolve,
while providing robust and increasingly remote reassurance to the administration.
Mirroring the Tax Administration 3.0 Vision, the Tax Rule Management and Application path of growth presented in the matrix below can be
characterised as:

28 |
• tax rule design and drafting increasingly becomes a co-creative effort between policy and administrative experts and governmental and private
stakeholders;
• a shift from mere translation of tax rules from paper into system designs, to incorporation of “rules as code” with transparency and testing
framework in place; and
• migrating from centralised execution of tax rules within the tax administration to a more decentralised network of ‘tax agents’ in that the tax
administration provides the technical rules and information needed for elements of tax processing to take place within taxpayers’ natural systems.
Tax Rule Management Emerging Progressing Established Leading Aspirational

and Application
The tax administration is not The tax administration is The tax administration is Co-creation of tax law with Tax law is increasingly being
generally involved in the increasingly involved in the heavily involved in the policy makers and designed via a rules-as-code
development of tax law, development of tax law to development of tax law and stakeholders is the norm. principle, allowing for direct
although it does provide help ensure administrability seeks to address issues of The law increasingly importation into taxpayers’
Descriptor downstream feedback to and to identify major implementation, compliance provides for greater natural systems. There is a
policy makers. Tax law is implementation issues for burdens and tax certainty standardisation of some transparency and testing
often difficult to administer, taxpayers. The upfront. The administration processes, including within framework in place,
and frequent legal changes administration proactively uses sophisticated analytics taxpayers’ natural systems, supported by AI. Assurance
place burdens of taxpayers produces extensive to detect non-compliance to enable more seamless that taxpayers’ systems have
and create tax uncertainty. guidance and engages with and measures overall tax outcomes and interactions. implemented tax law
The administration produces taxpayer representatives on administration performance Advanced data analytics are correctly is increasingly
guidance on the application possible improvements to and taxpayer patterns and increasingly used for tax law done through remote
of tax law in common tax administration systems. behaviours. Co-creation with assurance purposes. A processes involving AI, as is
circumstances. Assurance is Analytics is increasingly developers of software framework for the the identification and
mainly done through used for high-level implementing tax law is development of machine- resolution of remaining areas
individual audits and trends assurance of the application increasingly being explored readable rules-as-code of tax uncertainty.
identified in functional areas. of tax rules in addition to as well as the publication of legislation is being explored.
Indicative Attributes individual audits and some tax administration
identification of trends. APIs.
Tax rule development Tax law is generally developed The tax administration is Tax law is usually co- Tax law is increasingly co- The administration works
by policy makers and will often increasingly consulted on draft developed with the tax developed with stakeholders. closely with tax policy makers
not involve the tax tax law, allowing for some administration to increase To smooth implementation, tax and stakeholders on the
administration to any significant amendments to be made to precision in drafting and to law contains more prescription drafting of tax laws in the form
extent, or only after enactment enable smooth implementation address administrability and on the functions that need to be of machine-readable rules-as-
of the legislation. This means and avoid major administrability taxpayer burden concerns included in some networked code software where possible
that issues around the issues as well as to address upfront. Tax law is usually non- systems required by law (such to allow their direct
administrability of the law are major loopholes and areas of prescriptive as to the as e-invoicing or online cash incorporation into taxpayers’

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and Application
only identified after the law is in tax uncertainty. The functionality of the systems register systems), to ensure natural systems. This agile
place, which may result in administration has established used by taxpayers to comply, accuracy, integrity, process incorporates extensive
uncertainty and additional law an internal group to provide other than specified compatibility, and auditability. testing and development with
changes. input on tax policy proposals requirements around record These functionalities may be stakeholders, including
and to develop implementation keeping, reporting formats and embedded in APIs developed internationally where
approaches. taxpayer assurance processes. by the administration to assist appropriate, to ensure that the
with integration into taxpayers’ code is complete and works as
natural systems. intended.
The tax administration provides The tax administration, in A consultative and transparent As some elements of tax law A framework is in place for
limited guidance on its website consultation with taxpayer consultation process is in place become more prescriptive as creating standardised
or in printed form on how to representative groups, on draft tax law and related regards aspects of machine-readable tax laws in
meet legal obligations. provides extensive guidance on ongoing guidance to minimise implementation, the law is an agile manner, to ensure
Taxpayers need to proactively its website as to the application burdens and tax uncertainty. increasingly subject to prior transparency as to the intended
contact the administration of the law in different scenarios. For more complex testing, including through application of the law in multiple
where they do not understand The administration guidance is circumstances, there remains piloting, before coming into scenarios, as well as the testing
how the law applies to them; frequently updated to take scope for disputes on the force, and can generally be and correction processes.
they may often not be given account of new issues and correct reading of the law, and amended quickly where issues Remaining ambiguities in tax
definitive advice and are left to situations not envisaged when revisions may need to be made arise. The scope for disputes is law are increasingly identified
bear the legal risk. the law was drafted. to the law or guidance following decreased as there is less by AI, both within the
appeals decisions. room for different readings of administration and in
the law. taxpayers’ natural systems,
with recommendations given
for resolution.
While there is no systematic The tax administration works Some co-creation is beginning The administration has started AI is embedded in the systems
mechanism for identifying with taxpayer associations on with software developers of the exploring the processes used for the development,
difficulties that taxpayers have major implementation issues implementation of some more involved in the development of verification, test, and
with the implementation of tax and possible areas for straightforward tax rules into legal provisions which are refinement of tax rules with
law, when the administration simplification of rules. A programming language. The machine-readable, either in the transparency as to issues
becomes aware of major consultative process has been tax administration incorporates form of algorithms or software found and recommendations
implementation concerns it will established to consider simple tax rules into APIs it has code, with policy makers and for change. Tax rules can be
seek to work with taxpayer possible adaptations of tax developed allowing for the stakeholders. Some examples updated seamlessly across
representatives on identifying administration systems, in automation of some tax rule have been developed for natural systems when changes
possible workarounds. The tax order to make it easier for processes. The administration testing purposes and to are made (subject to the same
administration also shares taxpayers to interact may also certify or approve stimulate debate, including on testing frameworks).
feedback from taxpayers with electronically. some private sector the role of AI in systems

30 |

and Application
tax policy makers. applications. assurance.
Assurance of application Returns are manually entered Tax type specific IT systems PAYE-like systems and, in Digital platforms in addition to Data analytics has become an
of tax rules into the tax administration’s IT support the digital processing some cases, pre-filled tax traditional businesses are integrated part of taxpayer
system which runs automated of most individual and business returns enable frictionless agents of tax collection and, by natural systems and
assessments. Based on tax returns. While somewhat application of tax rules in some means of withholding or processes, providing seamless
predetermined risk markers, patchy across the areas of taxation. Business compliance by design features, assurance to the tax
returns are selected for manual administration, in some areas management systems are support taxpayers in fulfilling administration. AI is used in this
intervention by staff (including professional data analysts are supporting tax management their obligations. Artificial assurance process, providing
audits). Apart from these using combinations of internal and reporting, and they offer intelligence tools and recommendations as to where
automated assessments, the data sources as well as some possibilities for the introduction algorithms start to support the issues need to be addressed or
majority of taxation processes external data sources to assist of compliance by design characterisation and where enforcement processes
are paper-based. Most in assessing taxpayer risk solutions supported by assessment of liabilities and may be needed. Taxpayers are
decisions on the application of profiles and audits, as well as reporting of transaction data. increasingly support decision- also informed upfront regarding
rules are done by tax officials uncovering major anomalies in Sophisticated data analytics making as part of taxpayer tax consequences and
based on their knowledge and the general application of tax techniques support the systems. Analytics are built into liabilities, and it will be clear
experience (which may not be rules. Business have become integration and exploration of a wide range of business which rules have been applied
consistent across the important ‘agents of tax available internal and external processes within the tax to which data, reflecting facts
administration). administration’ especially data sets of tax administrations administration, increasingly and circumstances. Smart
regards VAT and first to detect anomalies, risks, and supported by AI to identify contract-like solutions,
implementations of PAYE-like potential underlying problems issues and to take automatic integrated in natural systems,
solutions. with tax law, with an increasing actions (such as taxpayer are increasingly used to settle
use of automation to flag issues prompts) or make tax liabilities in real-time.
for further investigation. recommendations for actions
by tax officials.
New Skill Sets

The skill sets within the current system of tax administration have been adapting over recent years to support more customer-centric e-services and the
greater use of analytic capability across the organisation, including for risk assessment and remote verification. However, to support the functional
processes of current tax administration, a large percentage of tax administration staff are reported as engaged in auditing, in debt management functions,
in customer support and registration, and in tax return and payment processing.
In the aspirational stage of Tax Administration 3.0, these processes will ordinarily be run automatically (and AI-enabled) within the tax administration,
including through inputs from other organisations, or within taxpayers’ natural systems. The skills required will be more focussed on supporting the

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operation and evolution of the tax administration system as a whole. This could entail expansion in resources and capabilities relating to strategy
development, IT, data analytics and behavioural insights. Tax professional roles will remain highly important, inputting to the development of domestic
and international rules, the identification of possible compliance issues, and dealing with more complex cases, including internationally where differences
in tax rules or their application may cause issues.
The Maturity Model description focusses on the processes needed to accommodate the workforce planning, recruitment and development of new skills
sets. Mirroring the Tax Administration 3.0 Vision, the New Skill Sets path of growth presented in the matrix below can be characterised as:
• shifting from ad hoc and decentralised to holistic and continuous processes for workforce planning and recruitment, informed by detailed analysis
and horizon scanning, as well as placing greater emphasis on organisational and individual agility;
• move from reactive execution of tax administration processes to proactive, AI-augmented, co-creation and co-governance of overall tax system
performance and resilience; and
• moving from reliance on self-learning and learning on the job to more structured and continuous organisational learning.
New Skill Sets Emerging Progressing Established Leading Aspirational

Workforce planning is There is some centralised An assessment is done with An assessment of likely A workforce development
generally decentralised. Skill workforce planning focused the support of the HR changing skills needs over approach is adopted to
levels and competencies on known skills gaps and function of current and the longer term is carried out assess current and future
required for individual tax expected vacancies in expected gaps in periodically, involving HR as skills needs for taxation
administration positions are individual business areas. competencies over the a strategic partner. This processes (within and
Descriptor generally understood by The core competencies medium term, both in considers changes expected outside of the
managers, although more needed in tax administration individual areas and within in the use of technology and administration). This
focused on the current generally are identified the tax administration as a data analytics and elements assessment is carried out
situation than on future centrally and communicated whole. Plans are developed of the digital transformation covering a multi-year period
needs. Addressing such to staff. These include some to help address any of the tax administration, involving outside
gaps is generally left to competencies relevant to shortcomings and to monitor including how this will affect stakeholders and considers
individual managers, with no expected developments, for outcomes, although these how the administration changes needed to meet the
centralised monitoring or example the increased use of are often based on the operates. The administration evolution of taxpayers’
evaluation. Some basic analytics. Staff and administration maintaining is proactive in defining natural systems. A strategic
training opportunities are in managers have a joint current business areas in characteristics and and multifaceted framework
place, although there is responsibility to identify and broadly the same form. An competencies of tax of strategies, methods and
significant reliance on self- take steps to address established partnership is in administration positions AI-supported tools is in place
learning for the development individual skill gaps. There is place between staff, likely to be required in the for continuous skills and
of new skills. a broad training programme management and HR which future. A broad-ranging set knowledge development, to
covering a set of basic as allows for greater tailoring of of policies, a robust help the administration to
well as some more advanced training options to match job organisational structure, and prepare and adjust to future

32 |
skills, and staff are requirements and changing a suite of data analytics changes. The administration
Indicative Attributes encouraged to undertake skills needs. applications is in place to is able to bring in the right
training development assess and motivate staff to skills by adopting different
opportunities. enhance skills and contractual approaches
knowledge on a proactive where necessary.
basis across the
administration.
HR strategy and function HR is aware of critical IT HR has an emerging HR awareness of disruptive HR acts as a change agent and HR is an integrated aspect of
capabilities. However, the HR awareness of disruptive digital digital impacts on staffing strategic partner working the organisation’s leadership,
function is mainly focused on impacts on staffing. HR capability informs the high-level closely with senior and the HR and change
documenting basic HR strategy is mainly internally HR goals and strategies for management on HR strategies management strategy are an
processes, for example for focused, identifying priorities supporting the achievement of to support the changing tax integral part of a holistic
hiring, performance for improving the efficiency, the administration’s objectives administration environment. administration strategy. This
measurement, and disciplinary effectiveness, and consistency over the medium term. The HR strategy and sub-strategies strategy is dynamic in nature,
issues, as well as for meeting of HR corporate services. strategies of individual for proactive support reflect the both adapting to and helping to
legal requirements. business areas within the tax strategic priorities and shape the changing tax
administration are largely challenges facing the administration environment.
independent and do not take administration as a whole,
account of possible rather than focusing on
organisational changes in individual business units.
response to digitalisation.
In many instances, HR only HR draws up an overview of HR, in consultation with A multifaceted and dynamic
On the basis of reported operational plan is developed.
becomes involved in workforce workforce planning needs, both individual business areas,
expectations, HR will assist This looks both at
planning at the point of formal outcomes sought and draws up an operational plan
business units through planned improvements in internal
notification of new recruitment, improvements to HR as to how to build its future
recruitment and training activity processes to meet future
lay-offs, redeployments etc. processes. A more detailed workforce, both through
throughout the year. However, workforce demands, including
HR may sometimes struggle to operational plan is drawn up by internal improvements (e.g., to
unexpected events may often facilitating different working
respond in a timely manner HR on how to achieve these recruitment and retention,
result in some posts remaining arrangements, life-long
when multiple requests are goals, including the expected career and talent management,
unfilled for long periods, with learning programmes etc., as
received at the same time and role of individual business general and bespoke training
possible increases in overtime well at how best to influence
assistance is generally units, managers, staff and HR. programmes) and through
working and/or backlogs. external constraints, including
confined to reactive There is some consideration helping to attract a talented
administrative processing. given as to how to improve workforce (e.g., through wider different ways of expanding the
future workforce supply, mainly outreach, external potential workforce through
focusing on building positive partnerships, facilitating different contractual
perceptions of the different ways of working). arrangements.
administration and the job offer. Targeted outcomes are sought

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for the changing skills mix.

Skills development The overall skill set of tax Digital skills sets are becoming Digital professionals and skill Tax administration specialists Tax administration processes
administration staff reflects the a more apparent and integrated sets are being recognised as team up with digital and and systems are being adapted
stable set of organisational part of some tax administration key contributors to the overall corporate functions to co- to a continuously changing
tasks and outputs. Legal and units and functions, such as tax administration performance create support tools for internal environment. A team of tax
administrative expertise and customer services and and quality. and external purposes in an administration professionals
competences are key inputs to exchange of information. Although some IT development agile manner. These solutions manage the change, in most
the quality-of-service delivery. In some areas, tax experts are is still being executed within are increasingly aligned with cases in co-creation with
IT deployment and IT skill joining up with Electronic Data dedicated departments, tax the main systems used by external parties. Tax
development is organised in a Processing (EDP) auditors in administration staff is joining up taxpayers. Tax administrations’ administration employees are
separate organisational silo. conducting taxpayer in designing digital customer processes are supported by AI- supported by a suite of
assessments. Large IT experiences supporting augmented tools in areas such intelligent tools and systems
departments support the compliance. Data analytics as decision-making and risk which are continuously updated
development of often siloed units are engaging with tax assessment. There is an and refined. Integrated teams
digital systems supporting tax administration departments to administration-wide focus on of behavioural, digital, and
professionals and their jointly develop products and new skill sets, such as the organisational experts assist in
processes. insights. digitalisation of business optimising system performance
processes tied to tax rules and There is an additional focus on
compliance risks, the use of skill sets for systems auditing
data, and the importance of and the ability to steer different
behavioural science, ecosystems, support
cybersecurity, and data ecosystem actors, facilitate
protection. their innovations and co-
develop solutions.
The existence of skills gaps The need to address skills gaps Development areas will be
Individual training plans are An organisation-wide
may be noted in discussions is included in individual recognised in individual job
drawn up for all staff in assessment of current and
with individual staff, objectives objectives together with objectives and subject to
partnership with managers and future skills needs is carried out
and/ or appraisals, but there descriptions of actions that periodic discussion between
linked to appraisals. These will covering a multi-year period,
are no centralised plans as to should be taken. But this will staff and managers.
set out how development considering expected changes
how they can be rectified, and not always lead automatically Achievement against
needs are to be addressed in the organisation, including
actions are mainly left to to training being provided nor development objectives will be
(which may be through formal the introduction of new
individual staff and managers. consequences if training is not covered in the appraisal
or informal training). Smart data technologies and the shift in the
There is a clear high-level undertaken. Training and process. An active learning
analytics instruments assist in nature of tax administration. A
objective on the importance of development is encouraged by culture is encouraged by all
areas such as identifying culture of continuous learning
training and development, but senior managers, including in managers. Training and
talents and in understanding and knowledge and skills
this is not fully supported in actively making time for formal development is known to be
key drivers of employee transfer is actively promoted at
practice. and informal training. valued at the organisational
motivation. Senior all levels within the tax
level, including by its

34 |
contribution to career management will have administration and is supported

development and/ or pay. measurable objectives relating by data analytics and AI-tools.
to the training and development Performance and outcomes are
of staff see themselves as skills also effectively measured by
champions and role models. periodically monitoring and
assessing the tangible
outcomes.
Basic introductory sessions Orientation courses for staff A set of training and There is a catalogue of regular A multifaceted approach is
provide training on general who are new to the tax development courses covering in-house and external courses developed for training and
working skills and practices as administration are regularly tax administration available to cater for the development. (e.g., IT boot
well as a general held to familiarise them with the competences is in place, training needs of staff and camps, hackathons, cross-
understanding of the basic job requirements and equipping employees for roles management allowing functional projects, rotation
responsibilities of tax expectations. Training is largely in other parts of the individual training plans to be schemes) as part of a
administration staff. These confined to functional areas. administration as well as drawn up, monitored and comprehensive, ongoing
sessions may not always be generating a wider evaluated. The quality and training curriculum to support
provided on a regular basis nor understanding of the range of courses and potential interactive learning. There is
be mandatory. administration’s operations and opportunities for external dynamic feedback from staff to
strategy. learning meet organisational inform future development.
skills needs.
Workforce planning Workforce planning, including There is a high-level annual The HR function works with In addition to looking at current Workforce planning forms an
headcount, skills-gaps and forecasting process through individual business units on workforce needs, longer-term integral part of the development
training, is primarily the which business units their expected workforce workforce planning is done on a of administration’s strategic
responsibility of individual communicate expectations for needs, including any new skill whole of administration basis. plan, identifying areas where
business units. Some known the year ahead to HR. sets, over the agreed budget This is based on agreed workforce constraints might
events (e.g., expected Workforce planning focuses on cycle and to identify any assumptions as to future impact transformational
vacancies or new roles) may be providing support to address significant concerns with workforce requirements. opportunities and how these
communicated to HR for known gaps, including skills current HR processes. This is Supporting analysis is might be overcome by
planning purposes, but this will gaps, as well as to respond to done in a standardised format undertaken of the current enhancing organisational
often be patchy in nature and expected patterns of personnel allowing HR to compile a view position, including agility and by active
done inconsistently between movements based on across the administration of organisational skills gaps, the interventions, including through
business units making it difficult experience from previous years current skills gaps and current effectiveness of changes to existing policy
for HR to plan. (resignations, redundancies, expected skills gaps in different recruitment, training and constraints (for example, tax
maternity/ paternity leave etc.). business areas, training and retention tools, changes in age policy simplification, pay,
recruitment needs, workforce profile, and workforce balance. allowable contractual
balance issues etc. Consideration is also given to arrangements, use of artificial
the main constraints on current intelligence etc.). Strategic

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and expected future workforce workforce planning is

supply. supported by comprehensive
analytics.
Governance Frameworks
The way in which tax administration is governed depends on political, cultural, societal, and technological factors. This is not only relevant the
organisation and control of the tax administration itself, but also includes cooperation with businesses, other governmental organisations, and non-
governmental organisations, including taxpayer representative groups. In many jurisdictions, businesses have become important partners, ‘agents’ of
taxation, and administer VAT and salary taxes. Along with societal changes, new tax governance frameworks have enhanced transparency and
accountability, including formal consultative processes, taxpayer rights mechanisms, offices for tax simplification, and co-operative compliance
programmes.
The nature of the transformation to Tax Administration 3.0, requires the joining-up of systems and processes across the public and private sector, as
well as internationally. This calls for a strategic approach and a structured form of governance if it is to succeed, bringing organisations together to
partner in the management of change.
Mirroring the Tax Administration 3.0 Vision, the Governance Frameworks path of growth presented in the matrix below can be characterised as:
• broadening the digitalisation focus from IT-Strategy, addressed in a digitalisation strategy, to tax administration business transformation,
addressed in a digital transformation strategy;
• shifting from a solitaire hierarchical bureaucracy to a partner within a ‘system of (tax) systems; and
• moving from reactive to proactive and towards an embedded assurance of the tax system.
Governance Frameworks Emerging Progressing Established Leading Aspirational

The administration’s The digitalisation strategy is The main focus of strategy A tax administration-wide The tax administration’s role
development of digital tools primarily focused on and governance frameworks digital transformation focuses primarily on
and technology is generally enhancing the efficiency of is to enhance taxpayer strategy is in place. The assurance of the overall tax
delegated to individual internal tax administration services and engagement. administration is making system, which now relies
business units and mainly processes, including around This includes the wider increasing use of big data in largely on taxation
Descriptor focuses on improvements in compliance risk utilisation of increasing analysing the performance of processes embedded within
the use of existing systems management. Increasing amounts of third-party data the tax system, in taxpayers’ natural systems,
and tools rather than in the priority is also given to the for pre-filling of some tax compliance assurance making it possible to develop

36 |

development of new development of more online returns, improving the processes, and in more compliance by design
approaches. Governance of services and online targeting of risk management understanding the wider processes, in the context of a
the overall tax system is communications to support processes, and uncovering taxpayer environment. wider digital ecosystem.
largely based on high-level voluntary compliance by wider trends and patterns in Simultaneously, a process is Joined-up with other parts of
information on overall taxpayers and reduce costs. taxpayer behaviours. There in place bringing together government, the private
revenue and timeliness of The administration is is some co-design and co- selected public and private sector, and civil society,
actions by taxpayers, and undertaking analysis of the governance of new digitised partners to create a there are more seamless
taxpayer engagement is taxpayer environment and systems, including on an framework for the greater processes across society
mainly confined to a small seeking to build more trusted international level. Analysis embedding of taxation which take account of
number of stakeholders relationships with taxpayers, of the changing environment processes into taxpayers’ societal concerns around
rather than the wider including through the facing taxpayers is natural systems. This access to and use of data as
taxpayer community. introduction of consultation, undertaken in a structured includes looking at issues well as accountability and
transparency, and and transparent framework. around new methods of control mechanisms.
accountability frameworks. engagement, co-creation,
Indicative Attributes transparency, accountability,
and assurance issues.
Strategy setting: context There is an annual information An administration-wide The digitalisation strategy is The administration continues to As taxation processes are
and process and communication technology digitalisation strategy is in mainly focused on improve aspects of the e- largely embedded in taxpayers’
(ICT) plan to improve the place, primarily focused on implementing an e- administration model, including natural systems, the tax
functioning of ICT processes improving the efficiency and administration model aimed at better joining-up across administration’s strategic plan
within some tax administration effectiveness of internal tax improving voluntary government and with a wider is now part of a wider ongoing
functional areas. This is driven administration processes by compliance. This includes for range of third-party data public-private strategy to
by the administration’s digitalising paper processes as example comprehensive online providers (including exploit the full potential of
objective for improving tax well as starting to collect third self-service options, wider internationally) to further digital technologies and tools to
revenue collection in certain party data electronically. This digital communication improve compliance and create more seamless
areas seen as allows greater matching of channels, and better reduce burdens. At the same processes for taxpayers and
underperforming, rather than taxpayer data, improving risk engagement with taxpayers to time, the administration is citizens across both
driving the digitalisation assessment and compliance help them understand their pursuing and increasingly government and the private
strategy (if it exists) of the monitoring and enforcement. obligations. In addition, the operationalising a longer-term sector. The main focuses are to
administration. In general, ICT The administration is also strategy envisages the digital transformation strategy. fill remaining gaps in the
improvements are not increasingly moving towards a development of increasingly The digital transformation compliance by design system,
considered from a taxpayer taxpayer-centric approach, sophisticated use of analytics strategy is focused on moving in particular for complex
perspective, and the aiming to improve taxpayer and behavioural insights to more taxation processes into multinationals, and horizon
development of self-service experiences through improving identify, influence and tackle taxpayers’ natural systems in scanning so that the
options is not seen as a online service options. non-compliance. A large order to create more administration can easily adapt
strategic priority. element of the strategy is compliance by design to changes over time, including
around the collection and outcomes and significantly changes in technology usages,

| 37

internal processing of third- reducing burdens by making citizen preferences (for
party data, including from other tax processes work more example as regards data
administrations, which is used seamlessly with taxpayers’ privacy) and government
for the pre-filling of returns natural systems. policy. The strategic plan
where and if possible. envisages the increasing co-
creation of international
solutions.
Individual business units work The digitalisation strategy is set The digitalisation strategy, The digitalisation and digital The outcomes from the
with ICT colleagues and top-down and contains the including recommendations for transformation strategy are strategy are transparent, and
software providers on mapping high-level objectives for reform. sequencing of activity, is drawn up in parallel to help the ongoing maintenance of the
and prioritising where better Working level groups are set up joined-up through a cross- ensure that incremental strategy is supported by a
digital processes would be of in functional areas to assist ICT administration senior group improvements align where stakeholder group representing
most assistance to address colleagues to identify priority drawing on expertise and ideas possible with longer-term other parts of government and
identified revenue concerns. areas for reform, including in from across the administration goals. The combined strategy a broad range of societal views.
The ICT function considers some cross-administration as necessary. It is underpinned relies on detailed analysis and The stakeholder group initiates
where there may be synergies systems. There is some by detailed internal analysis of observation of the customer debate on cross-cutting issues
between the requests of consultation with taxpayer the main compliance and journey, including interactions such as privacy, governance,
different business units, but representatives, including compliance burden issues, across government, and co- accountability, and
otherwise there is little central through surveys, although most including as a result of identification with stakeholders transparency, ensuring that
planning. Many changes analysis is internal or with problems with administration of the barriers to more informed and evidenced
involve the introduction or consultants (including from systems and gaps in third party seamless tax administration. decisions can be taken against
adaptation of commercially current ICT providers). data. Important elements of this the common goal of enabling
available software packages strategy are the creation of a seamless solutions for
rather than the development of culture of change and the taxpayers and citizens.
new systems. exploration of new methods of
engagement with private
stakeholders.
Governance models and While individual teams may There is a growing appreciation Making effective use of Managers at all levels see The administration culture at all
mechanisms consider ways to make more across the administration of the digitalisation and technology themselves as champions of levels is focused on achieving
effective use of digital tools for benefits of digitalisation for the tools is actively promoted by digital transformation, and and managing seamless
performing their functions, administration and taxpayers, senior management, and a there is an active programme in taxation and on exploring
there is no shared culture within particularly at the senior customer-centric culture is place to motivate staff and opportunities for the tax
the tax administration of management level who have promoted at all levels of the tax foster a culture of innovation administration to support the
realising the wider benefits of taken on a promotional role. administration. and change. realisation of wider societal
digitalisation for the However, the main culture of digital transformation.
administration and taxpayers, the administration remains
and this is not actively largely guided by

38 |

promoted by senior considerations of short-term
management. compliance, yield, and tax
administration operating costs.
The administration works In implementing the combined

Responsibility for the Responsibility for closely with taxpayer digitalisation and digital
implementation of the strategy The implementation of the
implementation of digitalisation representatives, other transformation strategy, the strategy is a continuous
projects generally rests at the largely rests with the government agencies and administration is developing
administration’s senior process carried out by the
business unit level. Central third-party data providers on and consulting on methods and administration through
involvement happens on a management team operating implementation plans. Through standards to support priority
within established internal and public/private partnerships,
reactive basis when major analysis and extensive areas. It is also focused on including increasingly at the
issues arise affecting public external accountability engagement, the developing trusted
frameworks. The administration international level, aimed at
perceptions of the administration has a good relationships with a wide range ensuring the interaction of
administration, such as is undertaking analysis of the understanding of the wider of external stakeholders to help
environment in which taxpayers connected systems to support
significant budget overruns, environment within which guide implementation issues. societally acceptable
failures of existing systems, operate, including their use of taxpayers operate and the main This includes articulating key
technology tools, and compliance by design
legal problems, or high levels of issues facing taxpayers, accountability aspects processes built into taxpayers’
taxpayer complaints. The identifying the key opportunities including overall compliance regarding public/private
for greater proactive natural systems. The
administration does not have a burdens. As a result, in some cooperation on the building administration has a detailed
structured process in place to engagement. There is also areas, implementation is blocks of digital transformation,
increasing analysis of the understanding of the domestic
enhance awareness of the starting to be co-designed and cross-cutting issues of on- and international environment
wider environment facing impacts of tax administration on across some government going societal interest such as
taxpayers. in which different taxpayer
taxpayers, including how they agencies and with some third- data protection, the role of groups operate, and how that
are using new technology tools party data providers, taxpayer artificial intelligence, environment is changing over
and compliance burdens. representatives and software transparency, and consent. time, allowing the
developers. administration and tax policy
makers to be both proactive
and agile in order to stay
aligned with new
developments.
Building trusted relationships is In addition to legislative A number of soft law best Traditional compliance risk Analytical processes, which are
not a tax administration priority, requirements, expectations of practices and supportive management processes are embedded within and across
although there is increasing taxpayers and the tax interactions which reduce the enhanced by the use of big taxpayers’ natural systems, are
engagement with very large administration are being set out risks of audit are in place, such data and advanced analytics, focused on identifying and
businesses and taxpayer in taxpayer charters, supported as taxpayer education which also provide greater taking forward actions to
representative groups. by taxpayer feedback, and in programmes, cooperative information about the address weaknesses in how
Effectiveness is measured by the increased use of compliance regimes, tax functioning of the tax system the systems operate and

| 39

taxes collected as well as the relationship managers for some control frameworks, and overall. At the same time, the interact, including
few factors that tax taxpayers. Audits are transparency expectations. Tax tax administration is vulnerabilities to unauthorised
administration can monitor in increasingly targeted through administration processes are increasingly working with both actions, and whether they are
regard to taxpayer behaviour, the increasing use of digitised becoming more proactive in domestic and global producing the intended
such as the timely returns and risk assessment. The identifying and responding to stakeholders, on (a framework outcomes. These processes
payments and the number of increasing use of data from a compliance risks and for the assurance of) are supported by extensive use
audit adjustments compared to limited number of government unintended burdens. The embedded taxation processes of artificial intelligence and the
previous years. The role of sources and third-party data administration works closely as well as digital auditing of real-time transparency of
digitalisation is not considered providers is governed under with stakeholders on the design systems. This framework processes and outcomes to
beyond the performance of legal frameworks and through and governance of domestic supports the increased rolling- taxpayers and third parties.
existing systems. In general, cooperative relationships with and international digital out of taxation processes into Quality is assured at the
taxpayers are not seen as data providers. Along with reporting systems, including taxpayers’ natural systems. transactional level through the
customers. Some use is made audits, feedback from taxpayer through co-creation processes. The tax administration is also extensive implementation of tax
of technology tools in assisting representatives and taxpayers implementing new rules by code. Tax
the selection of audits, although are an important part of the transparency and decision- administration focuses its
there are still large numbers of overall tax system quality making frameworks to maintain audits on taxpayer systems and
random audits undertaken. assurance process. taxpayer trust. the implementation of rules
instead of customers’ data.

40 |
Glossary of terms
Algorithms. A set of rules to be followed in calculations or decision-making operations, especially by a

computer. An example of how an algorithm might work would be the instructions set out in a recipe as to
precise measurements, the sequencing and detailed descriptions of tasks, cooking heat and time etc.
Application programming interface (API). A digital interface that defines interactions between multiple
software systems. For example, when using a price comparison App on a mobile phone, the API is what
allows for interactions between the App and the databases containing the price lists of various companies
which are used to assemble the price comparisons.
Big data. Sets of data characterised by such a high volume, variety and velocity that specific technology
and analytical methods are needed for their transformation into information and knowledge.
Building Blocks. Regards this Maturity Model, the building blocks refer to the six main components of the
FTA Tax Administration 3.0 vision and architecture. The six Maturity Model themes mirror these six building
blocks.
Co-creation. The collaborative design (co-design) process in which different stakeholders work together
by sharing ideas and jointly improving results.
Data analytics. The process of analysing raw data to answer questions and find trends and patterns. The
analysis is supported by specific statistical (often scientific or, advanced) methods and techniques.
Digital identity (Digital ID or DI). A set of attributes related to an entity (individual, organisation or
electronic device) that exists online, for example unlocking digital services with unique SMS authentication
and electronic passports containing embedded fingerprints.
Digital (online) platform. A digital service that facilitates interactions between two or more distinct but
interdependent sets of users (whether firms or individuals) who interact through the service via the Internet.
Digitalisation. Converting data into digital, computer-readable, formats. This allows for the substitution of
paper-based business processes by digital data processing applications, enhancing overall efficiency
levels.
Digital transformation. Refers to the (disruptive) economic and societal effects of digitisation and
digitalisation. It is changing the way people interact with each other and society more generally, raising a
number of pressing issues in the areas of jobs and skills, privacy and security, education, health as well
as in many other policy areas.
High-Level Descriptors. Text blocks concisely characterising maturity levels. Per Maturity Model theme,
descriptors distinguish each of the five maturity level statuses.
Indicative Attributes. Identifiers detailing and specifying the Maturity Model theme’s high-level
descriptions. Each indicative attribute contains several story lines illustrating the development process and
characterising the maturity level stepping-stones.
Pay-as-you-earn (PAYE) systems. In general refers to a system of income tax withholding by employers.

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Real-time processing: Refers to the actual time during which a taxpayer transaction takes place. From a
taxpayer perspective, a payment or change request, i.e. is being executed instantaneously and a result is
reported back almost instantaneously. Thus supporting seamless taxpayer experiences. Some
administrative back-off processes may lag behind, however not influencing the quality of the taxpayer
engagement process.
Rules as code. The process of drafting rules in legislation, regulation, and policy in machine-consumable
languages (code, machine-readable formats) so they can be read and used by computers.
Storylines. Narratives detailing the indicative attributes in the Maturity Model, often focussing on one
specific aspect to help specify and understand the nature and characteristics of the development process.
Tax agent. An organisation executing tax administration processes and task, e.g. businesses supporting
VAT and PAYE processes.
Tax identification number (TIN). A specific string of numbers uniquely identifying a taxpayer in addition
to other identifying elements such as date of birth, place and date of incorporation, name, address etcetera.
Taxpayers’ natural systems. Often termed ecosystems, are the set of interconnected elements through
which they engage with customers, other businesses, third parties as well as their own accounting,
software and technology solutions.
Taxpayer touchpoints. Services facilitating the engagement of taxpayers with tax administration
processes, e.g. via websites, call centres or software interfaces embedded in natural systems.
Tax professional. A person with the knowledge, credentials, and hands-on experience to assist taxpayers
with their tax preparations and declarations. These persons often represent a company offering tax
professional services representatives. Synonym for tax representative or tax practitioner.
References
OECD (2020), Tax Administration 3.0: The Digital Transformation of Tax Administration, [1]
https://www.oecd.org/tax/forum-on-tax-administration/publications-and-products/tax-
administration-3-0-the-digital-transformation-of-tax-administration.htm.

42 |
Annex A. Digital Transformation Maturity Model:

Self-assessment record sheets
Jurisdiction name:
Contact person:
Process check-list
Please complete the appropriate boxes related to process:
Appointment of facilitator Please choose: Yes / No
Number of staff in the self-assessment group
Appropriate distribution of grades Please choose: Yes / No
Involvement of official(s) from different areas of the tax administration Please choose: Yes / No (please comment)
Time taken in hours to complete the self-assessment
Self-assessment record
Please complete the following:

• conduct a self-assessment of the maturity of your organisation’s digital transformation approach
program using the above Maturity Model.
• complete the tables below by marking the appropriate boxes with an “X” based on your self-
assessment. Please only include one “X” per row (the one that best fits your level of maturity).
• send the completed tables to the Forum on Tax Administration Secretariat at FTA@oecd.org.
Please also consider the open questions at the end of the document. Your insights and feedback will be
invaluable inputs for enhancing this Maturity Model.
♦♦♦♦♦
Please send the completed Self-Assessment Record Sheet to the Forum on Tax Administration
Secretariat at FTA@oecd.org.

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Record sheet
Digital Transformation Emerging Progressing Established Leading Aspirational
Digital Identity Descriptor

Creation of digital identity and the
unlocking of service options
Uses of digital identity within the
administration and by taxpayers
Taxpayer Touchpoints Descriptor

Types and uses of taxpayer
touchpoints
Accessible services
Data Management and Standards Descriptor
Data availability and standards
Data security and privacy
Tax Rule Management and Application Descriptor
Tax rule development
Assurance of application of tax

rules
New Skill Sets Descriptor
HR strategy and function
Skills development
Workforce planning
Governance Frameworks Descriptor

Strategy setting: context and
process
Governance models and
mechanisms

44 |
Additional Questions
Question 1. Are there some of the indicative attributes or descriptors which you feel are misplaced
or wrong, or are there important indicative attributes that you think are missing?
Question 2. Are there areas where you think there is a lack of clarity with regards to the difference
between adjacent maturity levels?
Question 3. Are there areas where you think the language is unclear or ambiguous? If so, please
provide specific recommended changes to language.
Question 4. Is there any additional feedback you would like to provide regarding the Digital
Transformation Maturity Model, including the usefulness of discussions during the self-assessment?

FORUM ON TAX ADMINISTRATION
Digital Transformation Management Maturity Model

The OECD Tax Administration Maturity Model Series sets out descriptions of capabilities and
performance in particular functions or sets of activities carried out by tax administrations across five
discrete maturity levels. The intention of this series is to provide tax administrations globally with a tool to
allow them to self-assess their current level of maturity and to facilitate consideration of future strategy,
depending on a tax administration's unique circumstances and priorities.
The Digital Transformation Maturity Model covers the key building blocks of future tax
administration. This model is one of the first outputs following the OECD FTA’s publication of the Tax
Administration 3.0 Vision in 2020. Digital transformation refers to the fundamental changes in the way
that tax administrations operate, responding to the changes in how taxpayers interact and conduct
business with each other. In particular, this transformation is centred around the increasing migration of
taxation processes into taxpayers’ natural systems, i.e. the systems they use in their daily lives and/or
businesses. The model was developed by a group of Forum on Tax Administration (FTA) members and
refined through a pilot undertaken by nearly thirty FTA and non-FTA members. This report also sets out
the results of that pilot which allows administrations using the model to compare their own maturity in the
different aspects of digital transformation to that of their peers.
www.oecd.org/tax/forum-on-tax-administration/

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FORUM ON TAX ADMINISTRATION

OECD Tax Administration Maturity Model Series

OECD Tax Administration Maturity Model Series

Digital Transformation Maturity Model

Updated in September 2022

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Please cite this publication as:

Photo credits: © Suppachok N – Shutterstock.com

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

3. The Digital Transformation Maturity Model 16

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

This report consists of four parts:

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

1. Using the Digital Transformation

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Layout of the Digital Transformation Maturity Model

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Figure 1.1. The Tax Administration 3.0 Building Block model

Source: OECD (2020)

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Using the Maturity Model

The Digital Transformation Maturity Model is designed to be used as a self-assessment tool. To be

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Source: OECD Secretariat analysis based on participants’ self-assessments.

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Heat map key: Emerging 2 Progressing Established 4 Leading 5 Aspirational

Source: OECD Secretariat analysis based on participants’ self-assessments.

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

No. of DT staff in self-

Time taken to complete the

0 20 40 60 80 100 120 140

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Source: OECD Secretariat analysis based on participants’ self-assessments.

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

3. The Digital Transformation Maturity Model

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Digital Identity Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Digital Identity Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Digital Identity Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Digital Identity Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Taxpayer Touchpoints Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Taxpayer Touchpoints Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Taxpayer Touchpoints Emerging Progressing Established Leading Aspirational

Data Management and Standards

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Data Management and Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Data Management and Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Data Management and Emerging Progressing Established Leading Aspirational

DIGITAL TRANSFORMATION MATURITY MODEL © OECD 2022

Data Management and Emerging Progressing Established Leading Aspirational

Tax Rule Management and Application