The Federal Tax Service of Russia
Published: 13.12.2021 11:48
Considering remarkable success of the Federal Tax Service achieved in the area of improving VAT Compliance using technology, Nigeria asked the FTS of Russia to share its experience in this field.
On December 7, 2021, the FTS of Russia and the Federal Inland Revenue Service of Nigeria have organized the workshop devoted to e-invoicing system in the FTS of Russia. FTS of Russia colleagues have presented its implementation path of two systems. First, it is Online Cash Register system that transmits information about all transactions in near real time. The system implementation has caused the notable trade growth (annual VAT volume in retail increase of 165 % from 2017 to 2020). The system enables online monitoring of the economic situation as whole, as well as prices and consumption volumes. In addition, it has become an important source of reliable provided information for the whole of government. Data obtained by the system have proven to be a great opportunity for advanced analytics: during COVID-19 with the help of aggregated data, the government was able to instantly react on cases when in some regions there was a significant price increase in main food staples.
The second part of the presentation was focused on VAT Compliance system that allows replicating value creation chains and addressing shadow economy. Representatives of the FTS of Russia have presented advantages of the system for taxpayers, the tax administration and the government, particularly: the time reduction to get a VAT refund, the VAT tax gap decrease (from 8% to 0.46%) and huge decrease in the number of VAT frauds (by 15 times), and the VAT revenues growth.
Both systems allow reducing compliance burden for taxpayers and tax authorities.
Representatives from the FIRS of Nigeria highly estimated presented systems and asked some technical questions.
By the results of the workshop, the parties have agreed to strengthen cooperation between tax administrations and exchange experience in related fields.