3. Teaching tax essentials
This chapter looks at more formal and intensive taxpayer education initiatives, as well as the challenges and solutions to effective design and implementation. While most initiatives are focussed on students undergoing formal education, there are also those aimed at businesses and individual taxpayers.
Tax can be complicated, especially for those with little or no existing knowledge of the tax system. Students, adults, business owners, employees and vulnerable groups may all lack sufficient understanding of the design and working of the tax system, limiting their ability to engage effectively with it. Encouraging citizens to develop an appreciation of and commitment to the role of tax in society and ensuring that taxpayers and employees responsible for tax compliance are aware of their roles and responsibilities, can be a significant challenge.
Providing sufficiently intensive and in-depth taxpayer education to overcome complexity, make people more comfortable with their role in the tax system, and encourage long-term behaviour can therefore be a useful approach. Where the existing knowledge of the tax system is minimal, or understanding of vital detail is lacking, there is a need for an in-depth approach that provides an opportunity for deeper engagement by participants.
This chapter looks at a range of intensive taxpayer education initiatives which seek a more substantial engagement with participants. In contrast to the initiatives covered in Chapter 4, which are focussed on awareness-raising/mass marketing of tax and where the engagement with taxpayers is often short, the commonality among the initiatives covered in this chapter is a longer and/or deeper engagement with the participants, which creates specific challenges and considerations.
These initiatives are often resource-intensive and benefit significantly from partnerships, especially when seeking to expand. A common trait of the initiatives featured in this chapter is they tend to be resource-intensive. Reliance on face-to-face instruction is a key factor behind the resource commitment for many of the initiatives, though webinars are increasingly an alternative and can reduce the resources required. The resource requirements, especially the human resource requirements, often limit the scale of the initiatives unless partnerships can be established to share them.
While in-depth and intensive taxpayer education initiatives can be used in a variety of contexts, they are especially common with students. Encouraging voluntary compliance as early as possible has the greatest potential returns over time, creating an obvious benefit by building a durable understanding of and commitment to the tax system in the taxpayers of the future. The school system also provides an established network through which to deliver such programmes, whereas similar in-depth initiatives for adults face additional hurdles in establishing a delivery network.
More substantive taxpayer education initiatives also facilitate feedback and dialogue, helping identify challenges and possible improvements to the tax system. Especially in initiatives with businesses the added value of being able to obtain feedback from taxpayers on how the tax system is working (or not) was consistently highlighted as a benefit of the more in-depth style of initiatives covered in this chapter.
This chapter looks in detail at in-depth taxpayer education initiatives with different audiences – students, businesses and individuals – identifying common features, challenges and solutions. While there are some broad common features across all the initiatives, there are also specific features depending on the audience. The chapter therefore goes into detail to provide practical lessons for those thinking of implementing similar programmes.
Further details on 64 of the initiatives analysed to inform this chapter can be found in Annex A.
Tax morale generally appears to increase with age, which indicates potential gains in changing behaviour earlier. In the 2019 report Tax Morale (OECD, 2019[1]), age was found to be one of the prime determinants of tax morale globally, with older people less likely to justify cheating on taxes. This suggests that significant gains can be made by targeting efforts to promote the need to pay taxes among younger generations. Establishing a taxpaying habit early in a citizen’s life can return a significant dividend over the years.
Teaching tax to children can also be part of broader citizenship education. Educating children and teenagers on tax matters offers an opportunity to build the social contract, helping children see the social utility of taxes, from their use to finance public services and institutions such as schools, hospitals and the police to their redistributive function. At its most ambitious, it can help children identify not just their own rights and responsibilities, but also those of the state with regards to transparency and accountability over how taxes are spent. For example, in Guatemala the Tax Culture Training Programme was established in 2007 to teach tax as a fundamental aspect of citizenship among Guatemalans.
Integrating tax education into the education process is one of the most popular taxpayer education methods, though a range of approaches are taken globally. In the survey, initiatives targeting youth were the single most common type of initiative reported, with 43 examples provided by the 59 countries responding to the survey. Box 3.1 shows the reach of several of these programmes. There is clearly no standard approach, however, and the examples provided were varied, including: using modules on tax culture and citizenship in primary and secondary schools; conducting essay contests on tax culture; sending tax officers to schools to give presentations and have debates with students; and temporarily transforming students into civil servants.
3.1.1. Selected policy options
Putting tax on the curriculum
Integrating tax within school curricula has the potential for reaching (nearly) all future taxpayers. Schemes at the primary or secondary school level can aim for universal coverage across entire cohorts. For example, Mauritius introduced tax into the curriculum for grade 7 and 8 students (age 12-13) while Kenya expanded the school outreach programme highlighted in the 2015 report by starting to integrate tax into the curriculum of “carrier subjects”, such as History and Social Studies (Box 3.2). Such broad programmes are not simple to implement, however, requiring strong partnerships and significant resources.
Effective collaboration is needed between tax administrations and education ministries for school-based initiatives to grow to scale. Several countries (including Kenya and Mauritius) highlighted collaboration with the ministry of education (or the equivalent institution responsible for regulating curriculum content) as a vital partnership. This is necessary to enable teaching tax in schools to go beyond ad hoc partnerships with individual schools, becoming widespread and embedded as part of the standard curriculum.
As outlined in the 2015 report, Kenya established a school outreach programme in 2012. It provided for the Taxpayer Education Unit of the Kenya Revenue Authority to attend schools providing lessons and lectures on taxation, as well as training for students. At the time of the 2015 report, over 25 000 students had been reached.
Since the 2015 report, the scheme has continued to be successful and has expanded. The challenges of limited financial and human resources had already been identified at the time of the 2015 report. The Taxpayer Education Unit realised the need to establish a more sustainable long-term strategy to address this problem, mainstreaming tax education into the curriculum. Working with the Kenya Institute of Curriculum Development (KICD), the process is underway to introduce tax into a number of “carrier” subjects, including languages, mathematics, history, religious education and social studies. The roll-out began with grade 4 of the primary schools and will expand to other grades in due course.
The partnership with the KICD has been vital, enabling a scale and reach for the initiative that would have been impossible for the Taxpayer Education Unit to achieve alone.
Source: OECD Survey on Taxpayer Education Initiatives.
Tax administrations need to provide resources to support both students and teachers. While in some cases tax administration staff are responsible for delivering teaching on tax, they usually lack the resources to do so, especially in large-scale programmes where tax is part of the national curriculum. Instead, the role of the tax administration is generally to produce materials tailored to the educational level of the students targeted, often making them available online or through schoolbooks. One aspect highlighted by Argentina (Box 3.3) is the need to provide resources not just for the students, but also for the teachers, explaining the aims of the initiatives and how to use the resources. This is especially important where awareness and understanding of the tax system are generally low, as it may not be possible to assume that teachers are sufficiently tax literate.
The Argentinian revenue authority (AFIP) decided to target building students’ understanding of tax and of the role of tax in society. As AFIP wanted to ensure the continuity of the programme, a close alliance with the education system was sought. This approach was challenging, requiring the establishment of inter-institutional teams, regular meetings with the key actors in the education system, and agreements and collaboration with provincial governments. It also required significant investment in the creation of materials, and crucially the training of teachers to enable them to become agents of change and make tax integral to their teaching of citizenship.
The programme is viewed as successful, with an external evaluation from the University of Buenos Aries identifying high satisfaction and knowledge retention among participants. The investment in building support among multiple institutions also provided some resilience for the programme in the face of changes in management priorities, as other institutions remained committed.
The programme continues to expand and the resources are now included in the National Institute of Teacher Training of the Ministry of Education, making them available to all teachers.
These actions allow a change of view towards a subject that was traditionally considered only by technicians and experts. Teachers act as agents of change, including tax themes in their plans,
María Fernanda Mobilia, Head of Tax Education Division, Community Outreach Directorate, AFIP Argentina
Source: OECD Survey on Taxpayer Education Initiatives.
Developing digital resources can help scale up initiatives. The low costs of replication and the increasing availability of IT within schools means that electronic resources can play a useful role in delivering school-based initiatives, enabling common resources to be instantly shared nationally. In Turkey, the Tax Awareness training programme for children seeks to engage children throughout their school career, providing a range of digital resources to support teachers and students. The programme was developed in partnership with the Ministry of National Education, with training materials available through the Ministry’s training portal and further materials available on the public website (www.vergibilinci.gov.tr). This has enabled the initiative to reach around 5 million students.
While placing tax on the curriculum is the most comprehensive approach to teaching tax in schools, this is not always (immediately) possible. It can take time and resources to bring tax into the curriculum, both in the tax administration and in schools. Alternative, smaller scale programmes may need to be considered or undertaken as a pilot to prove the value of bringing tax into the school.
Several countries use tax officials to directly deliver lessons to students. For example, in Peru, Japan and Zambia, tax officials (often selected through requests for volunteers) present directly to children, engaging with them in debates and discussing the role of receipts in compliance. While this gives the revenue authority direct control over the content, it makes it more difficult to secure access, with several countries highlighting the challenges of agreeing times with schools. Such programmes are also often limited in scale, as they require the revenue authority to provide the staff. These programmes can, however, be a steppingstone to bringing tax into the curriculum, as shown in Kenya (Box 3.2). A further alternative that may be less resource intensive is for the tax administration to invite children to visit on open days, as happens in Spain and Romania.
Corporate volunteering implemented by SUNAT is an excellent way to strengthen the sense of commitment and conviction with the institutional mission of promoting tax and customs culture in the citizenry.
Marcial Rubén Esquives Guerra, Manager of Tax and Customs Culture, Superintendencia Nacional de Aduanas y de Administración Tributaria (SUNAT), Peru
Competitions and contests provide a way to raise the profile of initiatives and can also be used to encourage students to think about careers in tax. Several countries have contests where students are asked to write essays, letters or presentations on tax. For example, in Japan students write essays on why it is beneficial for everyone to pay taxes; in 2017 over 600 000 essays were submitted by junior high school students. In a contest held since 2008 in Spain, secondary school students have to write a letter to a tax evader, explaining why it is wrong to evade taxes and trying to convince the person to switch behaviour.1 Tanzania has an annual tax club competition in 311 secondary schools, which includes a competition in fiscal receipt collection, to encourage students and their friends and families to demand receipts when making purchases. Such competitions, often with finalists attending an event in the capital, can generate publicity and help raise the profile of taxpayer education initiatives. The Young Tax Professional of the Year (EY-YPTY) competition, run in many countries (e.g. Malaysia) in collaboration with EY,2 targets university-level students; it is designed to encourage participants to consider a career in tax. The competition is divided into a preliminary phase – where participants submit a response to a case study via a PowerPoint and a video presentation – and the international final, with students and young graduates representing over 30 countries competing for the EY-YTPY title.
Giving young people an experience of tax administration
While most strategies to engage future taxpayers seek to engage them in their own environment (e.g. school, university), an alternative approach is to bring them into the tax administration. This approach is generally targeted at university students and/or young adults, and seeks to involve them in the tax administration’s outreach with the wider population. These programmes generally seek not just to educate the students/young adults participating, but to make them role models, not just during their time in the official programmes, but throughout their working lives.
In Guatemala, 2 500 18–24-year-olds have been included in the “SAT Works for You” initiative. “SAT Works for You” is a civil service programme that the Guatemalan tax administration (Superintendencia de Administración Tributaria, SAT) set up to strengthen ties with the population. Its objectives are to ease taxpayer compliance with tax obligations and regain their trust. This is done by informing citizens about the functioning and importance of SAT in the economic life of the country, promoting tax culture, as well as providing assistance to the Maya-speaking population. The recruits participate in the activities promoting SAT and in the assistance to taxpayers, thus contributing to their communities’ development and becoming agents for the spread of tax information. One of the main effects of the SAT programme was the promotion of a better image of the administration among the segments where it was executed.
A similar initiative is deployed by the Mexican SAT, whose aim is to attract university students who are about to start working, providing them with tools to become promoters or spokespersons of tax culture and tax citizenship.
3.1.2. Common challenges and proposed solutions
While there are several different strategies for bringing tax into the curriculum, a set of common challenges has emerged for tax administrations when trying to implement such programmes. This section presents the main obstacles identified and highlights some of the solutions adopted by tax administrations.
Building effective alliances/partnerships (with schools/educational institutions)
It is clear that strong alliances and partnerships are vital, especially to take initiatives to scale, but these can be challenging to build. The most frequent problem highlighted by tax administrations was the reticence of school authorities to devote time and effort to the subject. Several responses to this challenge were identified:
Solution 1- Agreements with local/regional/national governments
Working with the relevant government authorities, ideally to integrate tax into the curriculum, is the most effective and permanent, approach. Obtaining the support of the authorities can enable tax to become part of the mandatory curriculum, unlocking the resources of the education ministries and/or schools to support the teaching of tax. This is the most common partnership observed in the survey. Where there are local/regional authorities, engagement at that level can also help ensure the initiative is implemented in line with local needs and priorities.
Such agreements can take time to develop. In Mauritius, the Mauritius Revenue Authority held several consultative meetings with regulatory bodies and concerned stakeholders to convince them of the importance of introducing tax literacy among the younger generation as a prelude to an agreement to work together.
Solution 2- Working with schools directly
In the absence of formal inclusion in the curriculum, working with schools directly can be effective and can illustrate the value of the initiative. Building relationships with school directors to outline the aims and modalities of the initiative can give the tax authority the opportunity to convince schools of the benefits of teaching tax culture at school. Such an approach generally requires that the tax authority be directly involved in the delivery of the initiative; while this is more resource intensive, it gives the tax authority the opportunity to maintain much greater control and supervision over the implementation of the programme.
Solution 3- Working with educational organisations
In many countries, a range of specialised organisations can help ensure programmes and content are relevant to young people. Tax authorities may not have the skills and up-to-date knowledge and awareness of the tools and trends most likely to engage young people. Partnering with more specialised organisations, especially those working in the education sector, can therefore provide useful assistance to tax administrations in the promotion and implementation of programmes on tax targeting young people, as well as assistance in the preparation and delivery of teaching materials. These can include NGOs as well as student and teacher unions and education institutes. Examples from the survey include the German Jugend und Bildung3, the Mauritius Institute of Education, the Uruguayan National Administration of Public Education and the Spanish Tax Studies Institute, with institutes for education being the most common partners observed in the survey.
Lack of awareness of the programme
Especially when the programme is not officially sponsored by a partner institution, a problem of visibility of the initiative can limit the impact. Several countries reported problems of lack of awareness in their responses to the survey, with several approaches highlighted to address this challenge.
Solution 1- Making materials directly available to teachers
One option is to make it easier for teachers to find and use materials to teach tax. In Germany, the finance ministry has a full range of resources for teachers available on its website. These resources are based on the format/structure teachers are used to and are regularly updated to match the current curriculum.
Solution 2 - Using the provincial branches of the tax administration to promote the initiative across the country
Spreading information on the initiatives throughout the territory is essential and an effective way to enable this is to involve the local branches of the tax administration, as is the case in Spain.
Limited Human Resources
Limited human resources are especially problematic when the initiative requires tax officials to deliver the programme directly (e.g. in schools). The most effective solution to this is to integrate tax into the school curriculum, with teachers delivering the programme; this may require an investment in training the teachers, especially where average societal understanding of tax is limited. Where it is not possible for teachers to deliver the programmes, identifying volunteers among tax officers can be effective. Within the Peruvian SUNAT, for example, the programme attracted the interest of more than 1 000 employees; the level of response was such that it was difficult for SUNAT to accommodate all the requests, yet it enabled the initiative to expand to additional schools.
Many businesses are established by individuals with limited knowledge of how the business tax system works. Addressing this knowledge gap is a key challenge for many countries, especially in the SME sector, where those with responsibility for tax matters may have no experience or qualifications. There are various ways to do this, including providing practical assistance (Chapter 5) or through awareness-raising campaigns (e.g., around filing deadlines – Chapter 4). This section looks at broader initiatives focussed on working substantively and interactively with businesses to build their knowledge and understanding of the tax system through dedicated training/education programmes.
Improving business understanding of the tax system can bring benefits for all. Businesses that are unaware of their obligations and rights run the risk of fines and penalties, as well as potentially not making use of provisions designed to help them. In addition, compliance and enforcement costs for both businesses and tax administrations are likely to be higher when businesses struggle to understand the systems and processes.
Well-designed training programmes for businesses facilitate learning in both directions. The primary focus is to raise the understanding, and ultimately compliance, among businesses regarding their tax affairs. In addition, however, well-designed programmes look to learn from businesses on where to target their efforts, and on how the challenges faced by businesses can be eased by improvements in tax policy and/or administration.
Training on tax can be provided via a range of modalities. These include seminars and face-to-face meetings, as well as webinars categorised by tax issues. Different approaches allow for different combinations of reach and depth of engagement. The best approach will depend on the needs identified and the depth of feedback required from businesses.
3.2.1. Selected policy options
Workshops
Workshops enable detailed and practical education to be provided in specific areas of tax, but significant preparation is needed to maximise their impact. As face-to-face workshops are resource-intensive and can reach a limited number of people/businesses, ensuring that workshops are focussed on the right topics and participants is important.
Consultation with taxpayers and research on taxpayer behaviour can provide valuable inputs into workshop programme design. Consultation with taxpayers provides an opportunity for them to describe what they feel they need from taxpayer education. This approach is most effective when taxpayers are already in the tax system, and have some experience with it, and therefore can effectively articulate the issues on which they require further education. Not all needs can be identified by consultation, however, not least, as many taxpayers (or potential taxpayers from the informal sector) may not be aware of/respond to consultation processes. Yet these may be the taxpayers the programme is looking to target. Tax administrations can use their own data to identify issues and sectors to target. For example, the South African Revenue Service (SARS) uses its internal compliance reports to identify which business sectors to prioritise and target according to their tax needs and responsibilities (Box 3.4).
Identifying the right participants and managing their expectations requires effective communications. While many participants may self-select for participation, others will need more active targeting. For self-selecting participants, making the process as simple as possible is important. In Chile, the Servicio de Impuestos Internos (SII) allows workshops to be booked online, with the website enabling participants to search the range of courses by theme. While this has been successful, an internal evaluation identified a need to include greater specificity in descriptions to ensure that participants attend sessions at the right level for their experience. Where specific taxpayers are being targeted for participation, a clear strategy can be beneficial, identifying the best means of reaching the targets (e.g., through direct communication with taxpayers, social media, traditional media, and industry bodies).
Effective partnerships can help improve the reach and impact of programmes. There range of partnerships observed in business workshop programmes highlights the range of ways in which partnerships can contribute to such programmes. At the more practical end, partnering with educational establishments can help provide locations for workshops, especially when looking to deliver workshops in more remote regions. Partnerships with industry/stakeholder bodies can be especially important to build both relationships and trust. Especially when dealing with businesses that are informal or uncompliant, where there can be fear and mistrust of the tax administration, the involvement of a more trusted group can help encourage participation. For example, in Mauritius workshops are delivered in partnership with groups including the Small Shop Owners Association, the SME Federation and the Women’s Entrepreneur Association.
The talks must be classified by the needs of the taxpayers. Consulting the taxpayers themselves is an important source of learning, since considering their needs allows the generation of content that can better meet their expectations.
Mr. Jorge Guzmán, Former Head of Education and Dissemination, Directorate of Taxpayer’s Assistance, SII, Chile,
The SARS approach to providing tailored education workshops is twofold. On the one hand, SARS contacts targeted companies to invite them to education sessions; on the other, the various stakeholders, such as companies or government agencies, can also ask SARS for personalised assistance. SARS offers several kinds of education sessions:
in-house workshops where taxpayers are invited through text messages and the quarterly published schedules on the SARS website
external workshops on the premises of the stakeholder/industry, based on the requirements specified and on the memorandum of understanding between the respective industries and Taxpayer Education
tax education sessions given by tax educators who approach stakeholders to offer their services, in return receiving on-site resolutions on their taxpayers.
The workshops incorporate Value Added Tax, Small Business Corporations, Income Tax, Provisional Tax, Pay As You Earn, and Public Benefit Organisations, among other topics.
SARS has collaborated, in the framework of this initiative, with banking establishments – which seek to educate business owners about how to utilize loans acquired from banks – and mining companies whose employees would qualify to receive shares from the company, and who would require education regarding the tax liability upon receipt of their dividends.
Source: OECD Survey on Taxpayer Education Initiatives.
Webinars
Webinars offer opportunities to provide programmes efficiently but can limit the scope for direct feedback and engagement by taxpayers. Many countries report using webinars as either an alternative or a supplement to face-to-face workshops, highlighting their potential for greater reach. For example, British Her Majesty’s Revenue and Customs (HMRC) webinars can accommodate up to 1 000 participants, this also limits the opportunity for individuals to ask questions or raise specific challenges with the tax authority. As such, webinars, especially large-scale ones, may be more suited to general introductory programmes than to detailed technical issues. It is also vital that webinars provide details of where taxpayers can obtain further information or support if needed. In this respect, webinars can be a useful complement to more technical workshops, providing a simple, easily accessible introduction and a gateway for more detailed programmes for those who require them.
Effective research on the topics to be covered is even more important for webinars. The restrictions on personal interaction in webinars reduce the scope to adapt or adjust content on delivery. Several of the survey respondents highlighted the importance of surveying taxpayers to identify the topics to cover.
Webinars can use a variety of communication channels to maximise reach. While government websites may be the most obvious place to host/share webinars, they may not be as effective as video hosting sites, such as YouTube, or social networks in reaching the target audience. Especially where programmes are looking to educate those who are less familiar with the tax system, making it easy to find content away from government websites is an important consideration.
Webinars can have a much longer lifespan than workshops and can be edited to make them more accessible. A key advantage of webinars is that once recorded, they can be uploaded for re-watching and therefore can have a much longer lifespan than a one-off workshop. Investing in editing to make the webinar more accessible, for example through the addition of subtitles and/or translation may be an effective investment.
Tax dialogues
Tax dialogues between the revenue authority and taxpayers focus more explicitly on two-way education. While all the workshops highlight the value of feedback (3.4 Impacts), tax dialogues between the revenue authority and businesses have feedback from taxpayers as a primary aim, looking to deepen understanding on both sides.
Whereas traditional workshops place the emphasis on increasing knowledge, tax dialogues focus more on tax morale. In Rwanda, the Commissioner General has regular tax dialogues with the business community in each province; a similar scheme has recently started in Sierra Leone (Box 3.5). In contrast to all other initiatives in this section, which were identified as primarily focussing on increasing the knowledge of taxpayers, tax dialogues focus on building the perception that taxpayers are treated fairly, and on increasing tax morale. In Tanzania, stakeholder forums are organised at the regional level to respond to specific identified needs (Box 3.6).
The Rwandan Tax Dialogues is a platform that brings the Rwanda Revenue Authority (RRA) Commissioner General in closer engagement with the business community to identify issues, challenges and possible solutions.
The dialogues take place in each province of Rwanda, as well as the capital, and are organised in partnership with the provincial governor and private sector federations. The Tax Dialogues provide for a two-way exchange, which the RRA perceives as helping build trust among taxpayers, increasing their confidence that they will be treated fairly. It also provides valuable feedback for RRA management on the views and concerns of the business community.
While the programme is estimated to have reached up to 1 500 taxpayers, there remains a challenge in ensuring the engagement of the business community, which is not as high as desired.
In Sierra Leone, there have been two sets of Business Dialogue meetings, organised with the support of the United Nations Development Programme and the African Development Bank. One hosted representatives of large taxpayers, the other small, medium, and micro enterprises.
Feedback from the events showed that taxpayers welcomed the opportunity to provide inputs into the tax administration process. The Sierra Leone National Revenue Authority (NRA) in return has welcomed concrete recommendations from taxpayers on how to improve the tax administration.
Source: OECD Survey on Taxpayer Education Initiatives and Sierra Leone National Revenue Authority.
Stakeholder forums are regional meetings that bring together the business community with the Tanzania Revenue Authority (TRA). The agenda for the forum is determined through feedback received from call centres, seminars or previous forums, which help to identify the specific needs in the area.
Working with the local TRA office, the forums are widely publicised through local media and planned to be highly participative, combining entertainment together with the technical content to encourage participation.
The Forums provide an opportunity for taxpayers to engage with the TRA, not only to gain information but also to raise concerns/complaints as well as provide feedback to the TRA to help improve their service and set the agenda for future Forums.
Source: Tanzania Revenue Authority.
3.2.2. Common challenges and proposed solutions
The main challenges encountered by those tax administrations having implemented education initiatives for businesses appear to be organisational and infrastructural in nature. The challenges are mainly associated with identifying the right participants, as well as the logistics for running the programmes. Effective research on taxpayer needs and flexibility in implementation appear to be the main solutions adopted.
Heterogeneity of targets
A common challenge is the wide variety of participant knowledge and needs. Effective research and preparation, combined with targeted communications to ensure that the desired participants attend, can help address this challenge. Many countries reported the value of using surveys to identify priorities for workshops/webinars, while others highlighted the role of tax administration data in identifying high-risk taxpayers to target. Creating feedback loops, so feedback from one workshop improves the design and targeting of subsequent workshops, has also been stressed by some countries. Providing follow-up resources, including footage of the workshop itself, can help ensure that participants who struggle to keep up during the workshop are able to reinforce their learning.
Encouraging participation
Encouraging participation can be challenging, especially when non-compliant taxpayers are being targeted. Countries identified a variety of approaches, including using social media networks, advertising on local radio, and direct contact by letter and/or email with high-risk taxpayers. Partnerships with trade bodies can help too, not least as these may reduce fear of engaging with the tax administration. In cases where trust of the tax administration is low, it may even be worth encouraging trade bodies or other groups to run education programmes independently. Some countries also provide a certificate of completion, which may help incentivise participation.
Integrating tax compliance into a broader programme to support business development may make initiatives more appealing. In Indonesia, the Business Development Services programme provides a broad curriculum to support micro, small and medium enterprises. Co-ordinated by the Ministry of Economic Affairs, it is run in partnership with several other ministries and covers issues such as branding, digital marketing and exporting, as well as bookkeeping and taxation.
Logistical issues
Logistical issues, such as difficulties in finding suitable venues and getting digital novices to register online, can lessen the impact of programmes. Partnerships with universities or local municipalities can help address the challenges of finding venues; in some cases, seminars are even provided directly in the offices of the companies requesting support. For countries where digital participation is not yet the norm, introducing online access to education can be challenging. Providing clear and simple instructions tested with the target audience is an obvious and effective solution. Several countries also identified a challenge, for both the tax administration and companies, in finding the right schedules for workshops and webinars; the ability to watch on demand is a potential solution to this problem, but does result in limited feedback.
In addition to their needs to be educated on their rights and responsibilities on paying taxes, individuals also often require education or information to enable them to hold governments (of all levels) accountable for how their taxes are raised and spent. While there are various examples of support provided to individuals on their rights and responsibilities for paying taxes, there are far fewer examples of support in holding governments to account. In part, this may be because the tax administrations may not see this clearly as part of their responsibilities. There are, however, other organisations that do focus on supporting individuals in this area, especially civil society organisations; the role of civil society organisations and other non-governmental actors will be covered in more detail in Chapter 6.
Given these dual needs, the initiatives to support individuals can take various forms and involve different actors. A wide range of initiatives were reported in the survey, including workshops for taxpayers (Lithuania) and monthly meetings with taxpayers (Romania). These are similar to initiatives undertaken for businesses, and so are not covered in detail in this section. Initiatives uniquely for individuals include programmes aimed at vulnerable groups, (e.g. Canada’s Outreach Programme, Box 3.7 and Argentina’s fiscal assistant programme), as well as initiatives that work with civil society organisations (e.g. Sierra Leone, Box 3.8).
One common objective of many initiatives aimed at educating individuals is the demystification of the tax administration. Many individuals, especially more vulnerable taxpayers, can find the tax administration confusing or even intimidating. Many initiatives are seeking to reduce this fear and confusion, making individuals more willing to both pay taxes and seek further support, including practical assistance of the type covered in Chapter 5. In Guatemala, the Tax Awareness Programme works with taxpayers who have been given suspended criminal sentences, in addition to encouraging participants to consider the consequences of their actions on tax collection (and subsequently state services), the programme also seeks to inform them regarding how the tax administration works, including differences between administrative and criminal offences.
Some of the initiatives combine both in-depth dialogue through teaching-focussed initiatives, such as those described in this chapter, with the more high-level communication-focussed initiatives of Chapter 4. This is especially true in initiatives focussed on supporting vulnerable groups, where a more intensive approach may be needed to ensure effective communication. Such initiatives have been included in this chapter due to their commonalities with other initiatives in the chapter that look to provide a greater depth of engagement and encourage feedback to the tax administration.
3.3.1. Selected policy options
Outreach programmes for vulnerable taxpayers
Vulnerable taxpayers may rely on their tax returns to establish eligibility for benefits and credits, which can increase the importance of providing education. In many countries, government benefits and credits are linked to information provided on personal income tax returns. This can make it especially important that vulnerable populations, including seniors, refugees and people with disabilities, are willing and able to participate in the tax system, which is why some countries have specific programmes designed to engage with them.
Because vulnerable taxpayers may be especially difficult to reach by the revenue authority, partnerships with dedicated community groups can be important. Many vulnerable groups may have limited experience with or confidence in engaging with the state and may not actively seek out support from the revenue authority. Partnerships with community groups with established relationships with the target populations can therefore help. One example of this approach is the Canadian Revenue Agency (CRA) Outreach Programme (Box 3.7).
The Canada Revenue Agency (CRA) Outreach Programme centres on increasing awareness and education related to benefit and credit entitlements available to Canada’s more vulnerable populations (indigenous peoples, newcomers and refugees, seniors, youth and students, people with disabilities, homeless and housing-insecure individuals, and modest-income Canadians), as well as providing them with information on benefits and credits.
The CRA employs dedicated outreach officers across the regions; they provide year-round, in-person presentations to these individuals and the community organisations that support them. During in-person visits, the outreach officers support individuals by telling them about the documents they might need when they receive a letter from the CRA. Outreach officers also promote the CRA’s Community Volunteer Income Tax Programme (CVITP) (Chapter 5), through which community organisations host free tax preparation clinics and arrange for volunteers to complete income tax and benefit returns for eligible individuals who have a modest income and a simple tax situation.
Through the Outreach Programme, organisations that serve vulnerable segments can schedule an in-person visit from an outreach officer. CRA outreach officers may present an information session for employees or clients, host a booth, or deliver a presentation at an event; they also provide tailored products to help inform individuals about tax-filing topics. These visits are conducted year-round (not just during tax season) and allow the CRA to reach vulnerable segments of the population – including those in remote communities.
The Outreach Programme also works with schools, shelters, settlement organisations, Indigenous organisations, professional associations, seniors’ groups, organisations supporting disabled people, and provincial and municipal governments to promote and host outreach events, leveraging their networks to increase the reach of CRA messaging. In addition, since 2016 the programme has collaborated with Service Canada, providing joint outreach to Indigenous communities. In response to the Covid-19 pandemic, activities have become virtual, enabling access to continue.
The main challenges in the programme have been adapting to the needs of the target communities by finding better ways to reach them and tailoring the materials in terms of both their content and their provision in languages beyond the two official languages of Canada.
In 2017 the programme reached over 73 000 individuals, with the equivalent of 55 full time employees working directly in the programme.
Source: OECD Survey on Taxpayer Education Initiatives.
Embedding taxpayer education in broader civil society programmes
Civil society organisations supporting the economic development of their communities can be useful partners in taxpayer education. Embedding taxpayer education in civil society programmes cannot only help reach a larger audience, but also help taxpayers see how tax compliance sits within the broader economic development of the community. Sierra Leone’s NRA partnership with the Civil Society Consortium is one example of how such partnerships can work (Box 3.8)
The Civil Society Consortium (CSC) is made up of mostly non-governmental organisations that help communities in addressing their socio-economic challenges. These organisations are respected and have authority in the local communities. Therefore, they get a good audience among the leaders and members of communities in the interior towns and villages. They use the local radio stations and town criers to engage with people and disseminate information.
With the intent of improving tax education in the country and to get members of the public to see the NRA as a partner in the development of the country, collaboration with these organisations was sought for tax education and promotion of voluntary compliance in areas that may not have been reached due to resource limitations. The Consortium members accompany the staff of the NRA to give more voice to messages and education on media platforms while they go on their own to villages for town hall meetings.
This was the first time the NRA signed a memorandum of understanding with a non-governmental organisation as part of its taxpayer education work. The NRA found that this partnership helped improve the public perception of the NRA, which had previously been associated mostly with enforcement, rather than helping taxpayers with their challenges. The project ran successfully, but a renewal has been postponed due to Covid-19.
The members of the consortium were trained well by tax officers, but there are some tax issues they could not address in detail. They therefore had to ask taxpayers to contact the NRA when there was no staff member with them during a tax education programme.
The NRA asked tax officers closer to the area where the consortium is engaging in tax education initiatives to join them, or it provided staff contact numbers when some taxpayers’ enquiries were difficult to address.
Source: OECD Survey on Taxpayer Education Initiatives.
3.3.2. Common challenges and proposed solutions for implementation
Geographic reach
As many of the communities being targeted are geographically dispersed, both use of online resources and local partners can help. While online resources may be easier to arrange, especially when targeting vulnerable populations, IT proficiency should not be assumed; online access should also not always be assumed, especially in developing countries. Identifying partners who can help extend the reach is therefore vital for some programmes.
Human resources
Programmes engaging individuals can be very resource-intensive; partnerships can reduce the demand on revenue-authority staff, allowing them to focus where the expertise is most needed. Most revenue authorities do not have the number of staff needed for mass campaigns. Lithuania’s ability to deliver workshops, for example, is in part limited by the number of staff trained to deliver the programme. Working with, and training, partners who can provide the basic teaching on taxes can be beneficial, enabling more complex and detailed questions to filter through to the tax authority, as seen in Sierra Leone. Other approaches include providing flexibility to allow staff from across the revenue authority to volunteer to participate, as done in Argentina (Box 3.9), helping to increase resources.
The Fiscal Assistant Programme in Argentina seeks to engage vulnerable groups in the tax system. It does this by seeking to engage with such individuals in the community, where the atmosphere is likely to be more relaxed and the tax administration will appear less threatening. The initiative is organised in partnership with local authorities to help ensure access to spaces where the tax administration is usually not present.
All employees of the tax administration are permitted to volunteer to become fiscal assistants and receive training to enable them to participate in the programme. Initially, there were challenges in ensuring that fiscal assistants would be permitted to take time away from their usual duties to participate in the programme; new procedures were required to facilitate the process. High-level support from the Federal Administrator helped encourage managers to support the programme.
While the programme remains in its early stages, early results have been promising and there are discussions to expand the programme. In common with other initiatives of this type, the employees delivering the programme have noted its value in providing feedback to enable them to improve the performance of their usual duties.
Source: OECD Survey on Taxpayer Education Initiatives.
Trust
Allying with grassroots organisations allows more effective outreach and legitimacy in the eyes of the public, which is sometimes accustomed to the presence of such organisations on the territory. Such partnerships can therefore be essential in allowing programmes to reach their target audience. Chapter 6 discusses in more detail the role of non-governmental organisations in taxpayer education.
Especially in the case of the initiatives targeting future taxpayers, the initiatives in this chapter are likely to have a significant lag between the delivery of the initiative and its impact on taxpayer behaviour. In many cases, and even more so where younger children are targeted, it may be many years before any increase in tax morale in individuals will be realised. This makes it especially difficult to track the impact of such programmes on behaviour, as demonstrated by the lack of in-depth impact assessments in the responses to the survey.
Qualitative assessments of initiatives are possible, with many programmes showing high satisfaction levels. Several countries have reported undertaking some assessment of their initiatives, generally focussed on the evaluation of the classes being taught and/or the dedicated materials produced. While such surveys may not be able to track the ultimate impact of the initiatives, they provide valuable feedback on how effective the materials created are as teaching instruments, as well as on how to improve the delivery of courses. In both the United Kingdom (UK) and Germany, participants in webinars surveyed indicated positive results. In the UK, the webinars delivered in 2018/19 had a customer satisfaction score of 88.81%. In Germany, the Federal Ministry of Finance surveyed secondary school teachers participating in their initiative, with 94% being highly satisfied with the teaching materials and 85% reporting that they were using the materials in other classes beyond the initiative.
Surveys can also generate valuable feedback to improve the design of initiatives. In Greece, the Independent Authority for Public Revenue’s Directorate of Tax Compliance undertook a survey which highlighted the individual teaching style and the technical infrastructure available in the schools as the key factors. Furthermore, it identified differences of opinions: primary school teachers thought that the tax education programme should be included in an already existing module, while junior high and high school teachers believed it would be better taught autonomously in the form of a project or as group assignments.
Short-term impacts on both knowledge and perceptions have been identified from some programmes. While the long-term impacts on tax compliance may be difficult to track, it is possible to assess the short-term impact on participants in terms of what they learned through the initiatives. Slovenia undertakes surveys on attitudes towards tax, which are compared between those students who have taken part in the initiative and those who have not. The results indicate strongly that those who participated had a more positive attitude toward and awareness of tax than those who did not participate.
Taxpayer workshops identified positive impacts in the relationships with the tax authority. In Senegal, workshops of around 60 SMEs were organised in each fiscal district. The evaluation highlighted that while most of those participating, especially from the informal sector, had a pre-existing fear of the tax authority, following the workshops there was near unanimous acceptance of the legitimacy of the tax authority and a widespread commitment to increase compliance.
[These workshops] show that a large proportion of taxpayers, especially those in the informal sector, have a fear of the tax administration, fuelled by ignorance and lack of tax culture. At the end of the workshops, they are almost unanimous in affirming the validity of the tax system and in committing to greater compliance with their tax obligations.
Alain Paul Sene, Head of Quality and Communications Office, General Directorate of Taxes and Government Property (DGID), Senegal
In addition, all the workshop-style initiatives highlighted the value of feedback from participants both in improving the specific initiative, and in highlighting broader challenges for participants in engaging with the tax system. In many cases (e.g. Rwanda, Box 3.5, and Argentina, Box 3.9) the feedback highlighted additional needs for more detailed/practical support for specific participants. The recognition of the value and impact of the feedback suggests that effective feedback mechanisms should be an integral part of workshop-style initiatives.
References
[1] OECD (2019), Tax Morale: What Drives People and Businesses to Pay Tax?, OECD Publishing, Paris, https://dx.doi.org/10.1787/f3d8ea10-en.