 Thank you very much. My name is Trond Jörgengall and I'm representing the Norwegian Tax Administration. It's very interesting and encouraging to see research and studies on tax administration and by tax administration looking at change and development and the impact on tax revenue. I've learned a lot, so thank you very much for your contribution and presentation today. As mentioned several times today as well, we live in a time where domestic revenue mobilisation is crucial, it's all about this, the conference is all about that. However, I'm representing a country and maybe an area of countries with tax authorities for different and reasons are more concerned with compliance, benefits for society and reduced cost of administration than tax revenues itself. I'm mentioning this because it's important to recognise the tax administration are different and find themselves in different stages of development. So developing countries might have similar challenges, but tax authorities are definitely have these similarities. So I might be knocking on open doors here, but still it's important to keep it in mind. It's both important and encouraging to see that all these three presentations are country specific studies that found in the base for adequate and some policy implementation in those particular countries. To Chris's presentation on audits and compliance in Uganda showing some very encouraging results when he finds a positive relation between audit and compliance. Not surprising to me maybe based on the focus at least many western countries have had two decades where they build up competence, at least believed that we have built up compliance as well. But at Chris's point out himself these studies are crucial to be done in the countries we look at and working specifically. Also the correlation seems familiar. I wonder a bit about the finding that result are not depending on the outcome of the audits. This is just my intuition and I know you mentioned it yourself that you might be a little bit surprised. But maybe there will be more about that later on I don't know. I also like to dwell on some possible drivers here. A famous psychologist Eric Kischler working in Stensly on taxes actually found in studies some years back, I believe that correlation between audits and control and compliance after control given that the level of compliance was relatively high to start with. On the contrary found that the correlation between audit and control and compliance to be negative if the compliance initially was good. So could the level of compliance among the auditing companies in Uganda be crucial for your findings? Secondly is the fact that the companies are selective for audits as a sufficient condition alone for the outcome? In order that you Chris has told me the other day as well and you showed as well that you've been doing some research in Rwanda Revenue Authority where they found a negative correlation between desk audits and compliance. I have to say it surprised me a little bit as working with Rwanda Revenue Authority it's among the better tax administration with working it to be honest. But nevertheless it also illustrates that the way we select, we do the audit and possibly how we communicate as well with the companies might have an impact on the relation between audit and compliance. There might be room for more research and follow up here for more clear policy implications for instance by looking at the differences in audits and maybe even examinations to see possible differences. The positive effects though from audits should make URI to keep the focus on comprehensive audits and proper risk selection. So and then of course how often should the companies be audited, how long does the effect last and so on. And all this as Chris mentioned as well should be weighted against the capacity and alternative gains and alternative projects as well. Ezekiel Swemer and Tira's pilot on more risk-based approaches to tax elimination shows a significant increase in the revenues of 10 to 15 percent. It's impressive. Toro risk selection plays a crucial role in targeting audits and examination in order to maximize impact on compliance and revenues. I mentioned the study that Tira see has done in Rwanda where they found the desk audits to have a negative impact on compliance. Such a result may assumingly be caused by less Toro risk selection. And then I also have some questions to you Ezekiel. You are saying that the numbers of companies with adjusted taxable income is the same before and after introduction of optimized control. That's also surprised me a little bit as I would believe that such adequate controls would lead to more flags and more selected firms that are more likely to get the tax adjusted. You're also saying at the end that introducing this risk-based approach is more efficient than introducing more examination. It might be a likely consumption but have you actually control for that in the pilot. It's encouraging results as mentioned and many of us know that establishing such control mechanism in a big core tax system and link a risk module with data from e-filing is a long way to go for many countries. Introducing this risk in an extra treats shows that it's possible to achieve results with more simple approaches in shorter time even while you are planning a broader or new tax system. It will be interesting to see in future how both compliance and revenues develop. And Jenda and the colleague here, using bigger companies as VAT agents is a creative solution and as you mentioned as well is used in some developing countries now. The results are also convincing leading to a significant increase in sales and VAT. I believe the results are driven by the fact that agents has no or less reason to underport or to deal with the supplier. That leads me to a question as well. Apart from being serious, maintaining the positive reputation ETC, what's in it for the agents? If you could elaborate a little bit on that. It will also be interesting to know if there are challenges related to having such withholding agents. Another challenge to my knowledge relating to withholding agents might be the fact that suppliers selling to agents need to claim refund for VAT on purchases. I'm curious about the experience in Sambia and whether you are able to cope with an increasing number of claims. This is also a potential threat to the trust of the authority if not handled well. I'll relate the question then as it might be as well whether you, based on your experience so far, see yourself broadening or narrowing the use of agents or whether you have found a healthy balance. This might also be a relevant question more for policy makers. When I have the floor here, I also want to say something about the approach to policy changes and domestic revenue mobilization in general. What should tax administration do? Many, many see the urgent need for DRM, domestic revenue mobilization. Due to increased rates, interest on state loans, low revenues due to lower activity and increased costs due to inflation. Research and studies we have seen shown us that relatively narrow projects and more traditional tax revenue approaches to what's improved can increase the revenues. A lot of good initiatives around, but also some thoughts based on my experience on building capacity in many countries. Keep the project simple and narrow rather than big and ambitious. Take into account your capacity. Ask do we have capacity to develop, carry it through and to maintain? Focus on longer and more sustainable effects rather than shorter one. One example is to ask yourself whether the domestic revenue mobilization project actually built trust towards the austerity or reducing it. Is the society and or the government ready for your project? One example of one thought could be is e-filing relevant for all taxpayer groups if they're not so much digitalized. Please also leapfrog but make sure you land and this is also related to the fact that you need to have capacity in order to do that. And saying this is not kind of contradiction to actually having longer strategic development goals for your organization. That is crucial of course. But it's not that this can go hand in hand with smaller and more narrow projects as well. Just mention that capacity is important and you don't need to do everything on the same time. So lastly just one thing I would like to mention is like there's a number of crucial international initiatives out here. Digitalization is one, the BEPS 2 is another one. A lot of resources also on assistance and cooperation with partners in lower middle income countries are currently and most likely also in the next two years linked to these two subjects. No doubt about their importance, digitalization is the way to go. However there is a long horizontal digitalization, it takes time. Global minimum tax is important to come by tax evasion on larger scale from other nations. However not all developing countries will gain significantly revenues from this. We will certainly and talking about NTA contribute and do our part in raising awareness and build capacity on this. But I fear that is other CB, other capacity building and even more crucial matters for some developing countries might get too little resources and too little attention in the coming years. So please ask yourself are these the most urgent matters when you do projects or do the partners have the level of capacity to take this on? Thank you very much. Thank you. Thank you Trond and thank you to our presenters. I think to kick off the Q&A session I'll allow the presenters to just raise the questions that have been put forward by the discussant and then we can open up to the floor. So Ezekiel do you want to go first? Thank you very much Trond for that highlight on our paper. And basically you touched on the two areas and of course one was just a comment to me that if these simpler risk-based methodologies or interventions can be beneficial and we surely need to capitalise on this area. And I agree with you if we do have very informative risk-surrection criteria that are in place and we really set into our system. We can surely have selecting risk-sensitive taxpayers for the examination purpose. So this is the way to go and of course not only limited to one tax type but I agree also with you that we need to expand now the scope not only to the CIT and the PIT but also the other major tax type like VAT and the like. And of course again to expand the scope and moving forward by automating now these procedures into our system and the system to be telling us by itself. But again the question which you highlighted you mentioned if we tested this group with other group rather than in Dar es Salaam only. Of course I agree with you maybe should be the scope of this study and perhaps in future we may try to test into different groups and again we could again maybe confirm our findings further if it was very effective if we do compare with the rest of the group. So I concur with you and perhaps it could be the area for further improvement. Thank you and I can stop there. Thank you Trot and I'm going to be very brief because I agree with everything you said. I think your point about the subtlety of audits and the need to evaluate these audits I think it's valid and this is one of the messages that we're trying to push through. You know this study and the other studies we have done on this concept. I mean there's the presumption that audits are working effectively but that's not actually true because it has to do with the content of the audit. It has to do with the signal. You know these audits convey to the taxpayer and how these signals are being interpreted by the taxpayer. So we have instances not only from Rwanda. I think this is something that I guess you alluded to but not only from Rwanda that we find a negative impact on the audits of test audits but there's a paper by using US data and they find that narrow scope audits have a negative impact on compliance as well. So I think the point is as you rightly said that we need to be a little bit more careful and we need to be focusing a little bit more on policy evaluation of those initiatives. So thank you. Thank you very much. Thank you. Thank you Trot. So the one question that I picked up was what would be the benefit to the agents if they engage in these withholding activities and one thing that I would say is the reduction in the audit time. So usually the problem with the audit and the authorities is to reduce the ghost suppliers and in this case where without the withholding mechanism it was a bit difficult for the authority to be able to know where the supplier was coming from. But then in this case they know because of the intervention and then it reduces the audit time for the agent. So that's mainly what I would say on that. In terms of challenges with the VAD system I would link that to the increased number of claims that results because of the intervention. For that I would say that now we're looking at the increase in the number of filers. So the most important thing now is that now we have an increase in the number of filers. Initially they were in there but now we have them. So it might be a bad thing that now we have an increase increase in the number of claims but then we should first look at the positives that we have all these firms who are not filing now filing. So that's a good thing and I believe that the ZRI is putting in place measures to tackle the increased number of claims. Also I agree with you that we need to talk about increasing or decreasing the number of agents. And I believe that it will be good to increase the number of agents in terms of having more with holding agents who would be able to reduce the wait time or the transaction time for these specific VAT transactions. Reducing them won't be the best because I feel that in that case then the ZRI would not meet its target by reducing the by increase in compliance. So I would say that the number of agents should increase but cost wise as we put in their presentation we should look at the cost involved here. So thanks a lot. Thank you so much for those responses. Yes you are Yanda. Do you want to add something quickly maybe just a minute so that we can give a chance for the questions on the floor as well. Yeah maybe I will just go straight to the last question which was whether we, the Xamarin authorities thinking of broadening or narrowing the number of agents. And well as for Ben has put it yes it would be nice to increase the number of participants in the withholding. However we've noticed the cost associated so far which was never thought of in the design at the beginning is some firms. Some withholding firms were beginning to hold on to the withheld VAT instead of remitting it to the authority because the authority owes them VAT refunds. And you know the issue of VAT refunds probably in the African context you can always never be up to date. There's always a backlog here and there due to maybe the risk based orders that have to be done on the claims before you pay and also other factors. So we are finding that now these agents are collecting yes we have the monies in the books we would have collected that VAT which would have otherwise not been collected. However the remittance or compliance by the withholding agents was reducing over time due to them trying to offset it against what ZRI owes them. So going forward we are thinking I think on this last slide we mentioned that in the design earlier this year we even exempted withholding agents from withholding among themselves. Because the quantums that now we're sticking to the withholding agents were quite huge. And probably going forward a more lasting solution I think in Front's comments I noted that you mentioned we should focus on more long term solutions, long term sustainable solutions to revenue mobilization. And as Zambia were thinking probably stronger fiscalization where we can have cost efficient fiscal devices which can help in the administration of VAT probably software based fiscalization solutions could be a longer term solution. Because then we'll be able to capture the VAT on our own in real time basis depending on the coverage of these fiscal systems. I think that's what I can add for now thank you. Thank you and as someone from the National Treasury myself I love when people have consideration of the fiscal costs that are associated to their recommendations. So if we can open up to the floor if you could just raise your hands I think we'll take three questions at a time. I see one hand at the back and another one here in front so maybe if you can take the gentleman at the back and the gentleman in the front and then I'll allow one online question and then we'll begin the next round with you. Okay thank you for the presentations. Now just one thing which I think is missing from the presentations. What is the cost of compliance from the farm side? Because maybe there are bottlenecks in terms of reporting. If that is the case then there will be no incentive for farms to comply with tax returns. So they only comply when they are audited because now they know they are on the radar. So that is missing from all the presentations. I think that would be important because maybe this infrastructure for reporting is very costly for farms. So they try to avoid that cost by not complying. Thank you. This question is for Ezekiel Suema. How did the tax officers in Tanzania Revenue Authority react to introducing the risk-based engine since this new device may have reduced their self-examination leading them to compete against technology? Thank you. And then we can take one more from the gentleman here in the middle. Thanks. Yeah. Thank you very much. My name is Waselik Gomegam from Malawi. Two questions I think to start with the last one on withholding VAT. I think the most argument against the withholding VAT relates to the taxpayers, the impact it has on the taxpayers. I think the benefits to the tax administration are documented. So I was wondering if it would be beneficial for Zambia and maybe this is just a comment to go the other way to see what has been the impact. And as the discussant has raised the issue of tax refunds because you are withholding 100% as it happens in Zambia and not a fraction of it. What has been the impact on tax refunds? Has that increased and what is the repayment period? I think the discussant did raise that but I didn't hear the response to this. I think this is a very critical issue when you're dealing with withholding VAT because the impact it might have on the businesses might be significant, especially when you're withholding 100%. That's the first issue. The second issue on the issue of CIT audit. I was wondering on the results you got on sector specific and to this I was wondering what did you note in terms of the compliance of two sectors, financial and telecommunication. I want to, if you have any insights on this, because when we're looking at the developing countries, these are the two sectors that are contributing maybe 50% or more of the revenues. So I want to see what the picture is looking like when you look at the audits in these sectors. Thank you. Thank you so much. If we could just try and keep the responses very concise so that we can do another round of questions before our session ends. Because we still have Yanda online, I think I'll let him go first before we lose him and then we can then go over to Ezekiel. Thank you, Yanda. I think I got two questions, which is the cost of compliance, so probably for VAT in this case and also the other one which was on the impact of the withholding on VAT refunds. To start with on the cost of compliance for VAT, the way the requirements for VAT in Zambia are such that companies beyond or firms beyond a certain level of annual turnover are expected to register for VAT. And the major assumption beyond this is that these firms should be able to meet these requirements, these formal requirements for compliant VAT which are premised on keeping proper books of records of accounts. And then below that threshold you have businesses which pay on a presumptive nature to take into account that it may be costly for them to maintain their books and so forth. And only when a firm decides to voluntarily register which falls below this VAT threshold is when they can be allowed to go on to the VAT register. So in short, it's expected that, well, what I can say is it's expected that firms should comply to the requirements. But due to the informal nature of our economy we're observing that it's again easy for smaller firms especially who are on the VAT register to disappear from the VAT chain. That was the fundamental problem. So you would have, because systems are not interconnected, are largely not interconnected in our economies, you find you can't trust them through the banking system because you're not interconnected through the insurance and so forth. So this VAT would be gone. Meanwhile the business has collected the VAT, they are registered for VAT but their demographics on the system are not traceable and so forth. So this was where probably the withholding VAT was coming in. I think that would be my comment on that, maybe Quabena can click and add. On the impact of the withholding on refunds, yes, because now we are collecting VAT essentially from more firms than before. There's more reporting than before the reform. Also the share that has to be claimed by the taxpayers increases at the point of introducing the reform. The only consolation in this case is that in terms of the accounting, because this firm is only appearing on the books because they participated in a transaction which you can observe from another taxpayer. So in terms of the accounting, it's an in-out. It's an in-out in terms of the accounting. Yes, there's an increase in terms of refunds but there's also an increase in terms of gross collections. So it's coming from, I think it's stemming from there. It's an in-out, it's an equal share going in or coming out. Or rather even a bigger share now coming in because there's some gross receipts which are entire based on the value added instead of the inputs. I think I'll end here for now. Thank you. Okay, thanks Yanda. Thank you very much and it was indeed a good question. And I can respond by saying change management is a process. Whenever you're coming up with a new way of doing things, sometimes you might get some challenges. But at least during the period for the intervention, we tried to control and it was faring well. But now moving forward, we now use ways of technology and try to convince the management so that to integrate the intervention through the system so that it can be the only way to go. I can confirm that change management is a process and that's a way to do. And of course the objective of the intervention were clearly said. One is also to reduce the time that we do spend in doing examination procedures. And again, we are looking forward to increase revenue and resources of course are scarce so we need to utilize them effectively. Thanks Ezekiel. Because we had one hand that was left over in the last round, I think I'll let the lady at the back come in because we are out of time. So I'll just go with that question and then we can close the session. Hello everyone, I'm Julia Mascagni from the International Centre of Tax and Development. I'm standing between you and lunch so I will be very, very quick. It is a question for Christos and team which we can discuss later. I was intrigued by your result on audits increasing revenue for both compliant and non-compliant taxpayers. And I'm wondering if we can maybe discuss more separately or if you want to say a few words about why do you think that happens as it say about the audit quality or the kind of signals that the audit process gives aside from just improving compliance. You mentioned the word signals before and I was intrigued by that. Thanks. Thank you. I think I have one minute. It's not enough to go through that but we're trying to understand why this is the case. Clearly as I said, signaling is going to matter. The process by which the tax authority does audit matters is the tick box exercise and we do narrow scope audits later on if they find something they need to comprehensive. We need to look at the process a little bit more carefully. But I completely agree with you that this is quite surprising but at this point in time we can speculate and unfortunately we don't have a good understanding of the mechanism as yet. Thank you for that. Thank you everyone. Thank you for your participation and thank you for the really great questions to the panel. And thank you for stepping in. A round of applause to everyone and off to lunch.