They spend hours waiting in line at tax offices.
In March 2014, with support of the World Bank, a Delivery Unit (DU) was set up in the Romanian Prime Minister’s Chancellery. Its mission: Get better results quicker for the PM in four priority areas.
Tax administration was one of them. The PM’s concern was the pain of paying taxes. Offering online services, for the first time, was one of the ways to decrease the cost of compliance. The DU estimated that they could save the taxpayer up to 12 days a year of waiting at the tax office.
The DU’s role was to plan for these improvements together with the Romanian Ministry of Public Finance and the Tax Administration Agency (NAFA). In a Delivery Agreement, the specific targets, metrics, activities, deadlines and responsibilities were spelled out. The DU was to then monitor the progress monthly against an agreed trajectory and help unblock problems in implementation.
In September 2014, the NAFA launched the online taxpayer platform called Private Virtual Space (PVS). It allows taxpayers to file their tax returns, get their tax bills and see their payments. The target was to enroll 30% of the eligible taxpayers by December 2015. Though the DU tracked progress monthly, the enrollment rate was still at 0.6% in June 2015. Clearly, the monitoring on its own did not help.
The DU analyzed the reasons for low enrollment, including technical issues, service range and quality. Low awareness turned out to be the main obstacle. So in the absence of a national communications campaign, the tax offices themselves were the second best channel for taxpayers to find out about the platform.
Nine tax offices in Bucharest worked with the DU over the summer. The DU trained the frontline staff and then tracked daily how many people were registered in the PVS from those that walked into the tax offices. The NAFA management received weekly statistics. The idea was to use high frequency data to understand why some offices enroll more than others, share the good practices, close the performance gap and make continuous improvements in all of them.
In parallel, all enrolled taxpayers received an SMS querying them on the quality of service that they received. The World Bank helped design the SMS campaign based on similar citizen feedback mechanisms in Albania and Punjab, Pakistan. It was ; and citizens welcomed it – close to 40% responded.
In combination with the daily enrollment numbers, the text messages told the stories behind the numbers:
“I had to redo the form three times and queue each time. They did not offer me any information,” allowed NAFA management to better target the improvements to a specific office and in the real time.
The PVS enrollment in the Bucharest tax offices doubled over the summer. The team from the tax office that registered the most taxpayers was recognized in the Prime Minister’s Chancellery. They made a video to inspire other offices. Based on the SMS feedback,
More broadly, this exercise also started to trigger changes in the public administration. The DU showed a different way of doing things, with a data-driven approach focused on the outcomes for citizens. First, it gradually improved the discipline in providing data by institutions. Later, through the frontline interventions, the implementing institutions started to see the impact and buy in to the approach. Today, the Romanian Tax Agency considers this to be the new way it does the business and plans to roll out the innovative approach nationally.