EFFICIENT TAX COLLECTION: A PROPOSAL FOR THE REFORM OF THE SELF-ASSESSMENT TAX SYSTEM

  • Jirasak Rodjun
Keywords: Efficient Tax Administration, A Self-assessment System, the Complex Tax Legislation, Criteria of Simplicity, Criteria of Certainty, Criteria of Convenience, Complicated Tax Returns, Compliance Costs, the System of e-filing, Tax Evasion, Revenue Loss, Voluntary Compliance, the Improvement of Voluntary Compliance

Abstract

The aim of this article is to study the tax payment under a self-assessment system. By applying the documentary research, I have found that the simplicity and certainty of tax law and the simplicity, certainty and convenience of tax collection are the characteristics of efficient tax law and tax collection. Thailand has adopted the self-assessment system. Self-assessment is convenient for tax-gatherers and reduces costs in the public sector, which encourages administrative efficiency. However, it increases costs in the private sector, because a taxpayer has to complete a complicated tax return resulting from the complex tax legislation. This does not comply with the criteria of simplicity, certainty and convenience. Complexity in tax legislation leads to complicated tax returns and increases compliance costs. At present, there are at least 3 measures to resolve the difficulty in completing tax returns and to help taxpayers with no knowledge of tax laws, namely: the tax gatherers’ assistance in tax calculation, provision of tax manuals, and electronic filing of tax returns and payment of tax.

In addition to the above measures, the following measures are recommended to help the Thai
government to improve the self-assessment system: governments should subsidize electronic filing; the
complexity of tax legislation should be reduced (e.g. the abolition of certain tax expenditures are likely to simplify the complexity in tax legislation); the system of e-filing should be improved continuously; there should be legal enforcement for keeping accounts and records; and penalties for non-compliance should exist, but be moderate.

Self-assessment may lead to tax evasion and revenue loss. In order to achieve greater administrative
efficiency, this system must therefore be designed and operated to reduce the taxpayer’s compliance costs
and to encourage voluntary compliance. The following measures would help improve voluntary compliance:
providing education with regard to Self-assessment; simplification of tax laws and procedures; improvements in the computing system (e.g. an automatic calculation of tax liability and a taxpayer identification numbering system); the training of tax officials to be capable of checking people who omit their duties to file tax returns; the imposition of moderate penalties, particularly upon people who fail to keep proper accounts and records; traders and professionals should be required to produce with governmental agencies copies of tax returns and receipts of tax payment at the time of renewing their business or professional licenses, and Self-assessment tax returns should be sent to people immediately after the end of tax year, and people who have not been sent tax returns should be required to notify the Revenue Department within a specified period.

Downloads

Download data is not yet available.

References

Chennells, L. (1997). The Windfall Tax. Fiscal Studies, 18(3)

Foreman, A. & Mowles, G. (2002). Zurich Tax Handbook 2002-03. Harlow: Pearson Education Limited.

Green, S. (1996). Self-assessment: A New Era for United Kingdom Taxpayers, But What About the Costs British Tax Review 1996. London: Sweet & Maxwell.

Hedges, A. & Bromley, C. (2001). Public attitudes towards Taxation. London: Fabian Society.

Homer, A. & Burrows, R. (2002).Tolley’s Tax Guide 2002-2003. (21st ed). Surrey: Lexis NexisButterworths Tolley.

James, S. (2012). A Dictionary of Taxation. (2nd ed). Glos: Edward Elgar Publishing Limited.

James, S. & Nobes, C. (2000).The Economics of Taxation. (7thed). Essex: Pearson Education.

Lymer, A. et al. (2003). Taxation: Policy and Practice. (10thed). Birmingham: Accounting Education.

Melville, A. (2004). Taxation: Finance Act 2003. (9th ed). Essex: Pearson Education Limited.

Morse, G. & Williams, D. (2004). Davies: Principles of Tax Law. (5th ed). London: Sweet & Maxwell.

Mumford, A. (1996). Self-assessment for Income Tax: The Relevance of Historical and Constitutional Difference. British Tax Review 1996. London: Sweet & Maxwell.

Musgrave, R.A. & Musgrave, P.B. (1984). Public Finance in Theory and Practice. (4th ed). New York: McGraw-Hill Book.

Nightingale, K. (2000). Taxation Theory and Practice. (3rd ed). Essex: Pearson Education.

Sandford, C. (1980). Tax Compliance Costs, Evasion and Avoidance. Income Redistribution: the Limits to

Redistribution. David Collard, Richard Lecomber and Martin Slater, eds. Bristol: John Wright & Sons.

Shipwright, A. & Keeling, E. (1998). Revenue Law. (2nd ed). London: Blackstone Press.

Slemrod, J. & Yitzhaki, S. (1996). The Costs of Taxation and the Marginal Efficiency Cost of Funds. Washington, D.C.: IMF.

Smith, A. (2000). The Wealth of Nations. (Edwin Cannan, ed). New York: The Modern Library.

Tanzi, V. & Zee, H. (2001). Tax Policy for Developing Countries. Washington, D.C.: IMF.

The World Bank. (1991). Lessons of Tax Reform. Washington, D.C.: The World Bank.

The World Bank. (2000). Thailand Public Finance in Transition. Washington, D.C.: The World Bank.

The World Bank. (2002). Thailand’s Troubled Tax Computerization Project. Retrieved on 15/03/2002, from http://www1.worldbank.org/publicsector/egov/Thai_taxcs.htm

Thirsk, W. (1991). Lessons from Tax Reform: An Overview. Tax Policy in Developing Countries. (JavadKhalilzadeh-Shirazi and Anwar Shah, eds). Washington, D.C.: The World Bank.

Tiley, J. (2005). Revenue Law. (5th ed). Oxford: Hart Publishing.

Whitehouse, C. et al. (2003). Revenue Law-Principles and Practice. (21st ed). London: Reed Elsevier (UK) Ltd.

Published
2020-06-29
How to Cite
Rodjun, J. (2020). EFFICIENT TAX COLLECTION: A PROPOSAL FOR THE REFORM OF THE SELF-ASSESSMENT TAX SYSTEM. Suthiparithat Journal, 30(พิเศษ), 253-265. Retrieved from https://so05.tci-thaijo.org/index.php/DPUSuthiparithatJournal/article/view/244053