Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) Tax Administration (P127807) EUROPE AND CENTRAL ASIA | Tajikistan | Governance Global Practice | IBRD/IDA | Specific Investment Loan | FY 2013 | Seq No: 9 | ARCHIVED on 08-Nov-2016 | ISR25688 | Implementing Agencies: Tax Committee, Ministry of Finance Key Dates Key Project Dates Bank Approval Date:31-Oct-2012 Effectiveness Date:08-Feb-2013 Planned Mid Term Review Date:30-Jun-2015 Actual Mid-Term Review Date:04-Nov-2014 Original Closing Date:31-Dec-2017 Revised Closing Date:31-Dec-2017 Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective (PDO) is to reform the tax administration to become more efficient and effective in collecting revenue, enhance the level of voluntary compliance, and improve the quality of taxpayer services. Specifically, the project aims to: (i) reduce the administrative cost of collecting revenue to make the Tax Committee a more efficient institution; (ii) strengthen theeffectiveness of the Tax Committee to fight tax evasion and reduce the size of the shadow economy; (iii) reduce contact between taxofficials and taxpayers to reduce avenues for corruption and create conditions for increased level of voluntary compliance; and (iv) provide good quality taxpayer services that would help reduce the compliance burden for taxpayers, thus improving the business environment and competitiveness. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Institutional development:(Cost $2.20 M) Operational development:(Cost $1.80 M) IT Infrastructure and system development:(Cost $12.40 M) Project Management:(Cost $1.60 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Moderately Satisfactory 11/8/2016 Page 1 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) Overall Implementation Progress (IP)  Moderately Unsatisfactory  Moderately Satisfactory Overall Risk Rating  Substantial  Substantial Implementation Status and Key Decisions Overall, the project continues to make good progress. Several indicators show an improvement, the Tax Committee is continuing to carry out reforms in parallel to the activities in the project, procurement is picking up pace, and the reform commitment of the management of the Tax Committee remains strong. Training of tax officials is conducted regularly. One of the important activities the project supports is training and capacity building of officials on a regular, ongoing basis. A new training event on resolving tax disputes was conducted for the staff of TC and judges of the Supreme Economic Court in August 2016. The Ministry of Finance’s (MoF) limited capacity in the area of revenue forecasting and impact assessment analysis continues to be an issue of concern. Under the project Component 2.B, the consulting company helped with developing methodologies for tax policy analysis, impact analysis, forecasting and modeling. Two training events on the above topics in Dushanbe and outside the country were provided for the Tax Committee and the Ministry of Finance staff. However, the methodologies have not been adopted yet. The Bank team encouraged the ministry officials to adopt and apply the above methodologies. The taxpayer survey commissioned recently will provide useful insights in taxpayers’ perceptions of quality of service and professionalism of the Tax Committee. The Tax Committee signed the contract with the selected company under this procurement package supported by the Bank project. TC has developed a methodology for conducting the survey and shared with the Bank for comment. It is expected that the first survey results will be available by the end of 2016. Also TC initiated a taxpayer satisfaction survey at its website. The idea of survey is to get taxpayers view on the quality of services provided by TC. It is expected that after summarizing of all responses, TC will develop an action plan on further enhancing the quality of services provided to taxpayers. WB Team presented a newly developed report on VAT taxation and tax expenditure management, which contains recommendations on improving performance on the above areas of tax administration. The report was shared with the Government and it is expected that based on report recommendation, MoF and TC will develop an action plan on improving VAT and tax expenditure management. The recently published Doing Business 2017 Report reports significant improvements in tax administration in Tajikistan. The paying taxes rating is up to 33 points – from 173 to 140 – largely due to the introduction of an electronic filing and payment system for corporate income tax, VAT and labor taxes. The specific conditions for extension of the project closing date agreed over the previous mission in April 2016 have been met. Extension was conditioned on: i) launch of second stage RFP for Human Resource Management Information System (HRMIS); ii) launch of first stage RFP for Integrated Tax Management Software (ITMS); and iii) increase in project disbursement rate up to 40 percent. TC has already signed a contract with firm to supply and implement HRMIS. The first stage RFP for ITMS has been published at the end October. The current project disbursement rate is 41.7 percent. The Bank team intends to request approval of the extension of project closing date in late October 2016. 11/8/2016 Page 2 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  Substantial  Substantial Macroeconomic  --  High  High 11/8/2016 Page 3 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) Sector Strategies and Policies  --  Substantial  Substantial Technical Design of Project or Program  --  Moderate  Moderate Institutional Capacity for Implementation and Sustainability  --  Substantial  Substantial Fiduciary  --  Substantial  Substantial Environment and Social  --  Low  Low Stakeholders  --  Substantial  Substantial Other  --  Substantial  Substantial Overall  --  Substantial  Substantial Results Project Development Objective Indicators PHINDPDOTBL  Increase in Voluntary Compliance (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 161000.00 276043.00 286628.00 201500.00 Date 30-Jun-2012 01-Jan-2016 30-Sep-2016 31-Dec-2017 PHINDPDOTBL  Improved taxpayer service (Hours, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 226.00 209.00 209.00 180.00 Date 31-Dec-2011 01-Jan-2016 30-Sep-2016 31-Dec-2017 PHINDPDOTBL  Increased Efficiency (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value TJS 2.1 million TJS 4.4 million TJS 3.4 million TJS 2.9 million Date 31-Dec-2011 01-Jan-2016 30-Sep-2016 31-Dec-2017 11/8/2016 Page 4 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) PHINDPDOTBL  % of taxpayers filing electronically (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 34.30 50.40 70.00 PHINDPDOTBL  amount of tax arrears as a percentage of total annual tax collection (excluding Barqi Tojik) (Text, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 13.8 6.9 10.5 10.0 PHINDPDOTBL  share of revenue collected by LTI (Text, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 43.6 43.9 42.9 60.0 PHINDPDOTBL  Enhanced Effectiveness: tax gap as measured by VAT productivity (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.37 0.31 0.30 0.42 Date 31-Dec-2011 01-Jan-2016 30-Sep-2016 31-Dec-2017 PHINDPDOTBL  Enhanced Effectiveness: tax gap as measured by CIT productivity (Number, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.03 0.10 0.12 0.06 11/8/2016 Page 5 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) PHINDPDOTBL  Adjustment as a result of audit per auditor (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 184.00 636.60 832.30 280.00 Date 31-Dec-2011 01-Jan-2016 01-Jan-2016 30-Dec-2017 Overall Comments Intermediate Results Indicators PHINDIRITBL  Component 1 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Bids for the HRMIS system have been received from five vendors and the first Bids for the HRMIS is stage evaluation is completed and supplier currently underway. It has been selected. It is System fully Value No HRIS available is expected that the expected that HRMIS operational new HRMIS system will be fully operational should be customized by July 2017. and deployed late this year and be rolled out across the TC in early 2017. Date 05-Sep-2012 18-Apr-2016 01-Nov-2016 31-Dec-2016 11/8/2016 Page 6 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) PHINDIRITBL  Component 1 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Training Center in the Sughd Region has been Training Center in the equiped. Sughd Region has The new building of been equiped. Training Center in the Training center Value Training center not present The new building of Kulob Region is fully equipped Training Center in the operational. Training Kulob Region is Center is Khorog will be operational. operational in early 2017. Date 05-Sep-2012 18-Apr-2016 01-Nov-2016 31-Jan-2015 PHINDIRITBL  Component 1 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The consulting The consulting company company has helped has helped TC with Training TC with developing the developing the Training strategy and Training provided in ad hoc Training Strategy. It is Value Strategy. It is expected curriculum manner expected that the that the Strategy will be design Strategy will be adopted in 2016 and developed adopted in 2016 and later implemented. later implemented. Date 05-Sep-2012 01-Oct-2015 01-Nov-2016 31-Dec-2015 PHINDIRITBL  Component 1 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Organizational review, The new organizational The new organizational workforce structure was approved structure was approved review, Organizational plan for HQ Value by the Government on by the Government on organizational submitted to government July 2012 and currently July 2012 and currently restructuring is being implemented. is being implemented. and staff redeployment completed Date 05-Sep-2012 01-Nov-2015 01-Nov-2016 31-Dec-2016 11/8/2016 Page 7 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) PHINDIRITBL  Component 2 (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 13.80 6.90 10.50 10.00 Date 31-Dec-2011 01-Jan-2016 30-Sep-2016 31-Dec-2017 PHINDIRITBL  Component 2 (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 48.00 43.90 42.90 60.00 Date 31-Dec-2011 01-Nov-2015 30-Sep-2016 31-Dec-2017 PHINDIRITBL  Component 2 (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.05 34.30 50.40 70.00 Date 31-Dec-2011 01-Jan-2016 30-Sep-2016 31-Dec-2017 PHINDIRITBL  Component 2 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target As per the tax As per the tax committee, during the committee, during the first quarter of 2016, first quarter of 2016, the the number of queries number of queries answered was 3,800, answered was 3,800, which is significantly which is significantly higher than 1,279 higher than 1,279 queries answered over queries answered over Call center Value Manual system available the same period of last the same period of last operational year. The monitoring of year. The monitoring of queries shows that a queries shows that a large part of the large part of the questions deal with e- questions deal with e- filing, VAT invoice and filing, VAT invoice and liquidation. The project liquidation. The project will support the further will support the further 11/8/2016 Page 8 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) development of the development of the Call Call Center by Center by providing call providing call tracking tracking and other and other relevant relevant software and software and equipment. equipment. Date 05-Sep-2012 18-Apr-2016 30-Sep-2016 31-Dec-2014 PHINDIRITBL  Component 3 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The new Data Centers are expected to be The new Data Centers accepted by the TC by (DC) became the end of April. Both operational in mid- the primary and the September with the disaster recovery sites successful completion of are ready for final the migration of all acceptance by the TC. operational systems With delays in the from the old server room acquisition of the in the Headquarter Supports current legacy HRMIS and ITMS building to the new Data Data center Value system systems, the TC’s plan Center in Dushanbe. TC fully operational to decommission the maintains a small existing DC when the monitoring staff in an new ITMS is available office area attached to needs to be reworked. the DC. All other The TC should plan to development and migrate to the new data maintenance activities center and fully occur from the IT teams’ decommission the old offices in the data center by the end Headquarter building. of 2017. Date 05-Sep-2012 18-Apr-2016 30-Sep-2016 30-Sep-2017 PHINDIRITBL  Component 3 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The ITMS procurement document has been Work on ITMS will start approved and will be after completing published by the end of Component 2. October 2016. This is an ITMS deployed Existing tax system has Value Operational international tender with and fully limited capacity Development, most two phases and is operational likely, in the summer expected to be 2016. completed by September 2017. The new system will be 11/8/2016 Page 9 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) operational in March 2019 with the full system available by September 2019. Date 05-Sep-2012 18-Apr-2016 30-Sep-2016 31-Dec-2016 Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P127807 IDA-H8100 Effective XDR 11.90 11.90 0.00 4.89 7.01 41% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P127807 IDA-H8100 Effective 31-Oct-2012 14-Nov-2012 08-Feb-2013 31-Dec-2017 31-Dec-2017 Cumulative Disbursements 11/8/2016 Page 10 of 11 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Tax Administration (P127807) Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 11/8/2016 Page 11 of 11 Public Disclosure Copy