Tax authority under PwC's scope

Issues

PriceWaterhouseCoopers has released its 2013 national survey of taxpayers' perception of changes in the National Tax and Customs Administration (NAV) and its regulatory environment. BBJ looks at the results while PwC Hungary partner János Kelemen also weighs in...

“Following the evaluation of the survey responses of the participants, we can define where the critical points of the system are,” PwC Hungary partner János Kelemen said. Based on real feedback, the National Tax and Customs Board can evaluate its activities and have an opportunity to properly address the issues raised.”

If we would like to summarize the results in a brief phrase, the Hungarian Tax Authority performs its job better than one and a half years ago, according to the anonymous responses of the 400 participants. On a scale of 0 to 100, the overall satisfaction level of NAV reached 51 points this year, a significant improvement from the last survey’s 44 points. But of course, the Devil is in the details.

Better service with many errors
To start with the good news: 85% of respondents (both corporate and private) think that the tax authority meets the deadlines and 90% think that NAV informs properly on expected legal actions and sanctions. Also, the tax assessors’ legal preparedness is improved over the previous period. However, the list of bad remarks is a bit longer.

Some criticized the practice that NAV prolongs deadlines and said too lengthy procedures interfere with the normal course of business. Due to organizational transformations at the authority, one-third of the responding large taxpayers have been transferred from the Large Taxpayers Directorate to regional tax offices. According to respondents, NAV’s experience, organizational transformation in the field of customer service, speed of procedures and controls were not the subject of relevant changes. There have been, however, adjustment difficulties, primarily due to the different business practices of offices and a lack of concern for large companies’ issues.

Participants in the survey were satisfied with the courtesy and auditing professionalism of assessors, but the lack of industry-specific knowledge still inhibits smooth administration. One-fifth of responses also indicate that taxpayers consider it doubtful that their arguments on appeal would succeed, so sometimes they do not ever tried a legal remedy. “On the other hand, some respondents claimed that they didn’t push for an appeal because the authority’s resolution was fair or the amount of the fine was so small that any further action seemed to be a waste of money and time,” Kelemen said.

Information, administration
Some 89% of respondents visit NAV’s website before undertaking administrative issues. However, information on complex or problematic new legislation appear on the website only four or five months after come into force, according to many complaints. That said, electronic procedures have proved to be a real success story: figures show that administration via the e-government website or client contact centers is very popular, and the satisfaction level of these services is around 60-70%.

But taxpayers still aren’t satisfied: they want the number of electronic services expanded. And there are many areas where great improvements could be achieved, for example assessors or contact persons cannot be reached via e-mail, an upgrade 80% of the respondents would find very useful. “Many responses said that requests from tax office local and business tax filings could be handled electronically, but is currently available only via ordinary mail. It would also be very useful to shorten the deadline for case resolution and create the possibility to edit and modify tax filings via the client service centers,” Kelemen added.

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