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How the Internet of Things is improving Tax Services in ASEAN

"'In this world nothing can be said to be certain, except death and taxes." Benjamin Franklin

Tax revenues are vital to support infrastructure that citizens rely on. These revenues help fund nation building and is used to support projects including ICT, improving education, food security and housing services. Without the support of tax payers, many of these programs cannot exist. Tax agencies around the world are increasingly leveraging technology to increase productivity and plugging the leakages of tax collection. Countries in South East Asia are no different.

Philippines : Enhancing Tax Field Operations with the Internet of Things

At the Philippines Edition of Asia IoT Business Platform 2016, Carolyn Reyes, Director of Information Management Systems, Bureau of Internal Revenue (BIR), shared that how BIR has been taking steps to modernize its Internet of Things (IoT) infrastructure, hoping to IoT to improve efficiency of tax collection.

One of the areas of improvement is in enhancing field operations, utilizing IoT to improve the Mobile Revenue Collection Officers System. BIR officers are equipped with a mobile device which can generate tax receipts and also send real time information to the central database. The devices allow geo location and helps in optimizing the route of field collectors.

At present, the BIR is also enhancing their database, to define where companies are located and where these companies are actually manufacturing their goods and services. This is used in conjunction with a stamp system to plug tax leakages. For example, If you buy a Philippine manufactured cigarette, the packs already have stamps, which can be inspected in the market place. BIR inspectors use their mobile devices to detect fake or unregistered items which will automatically be flagged up in the central system.

The BIR is also looking at other initiatives to further extend IoT utilization, such as collecting data coming from external devices such as fuel pumps, automatic vending machines and carpark systems to have real-time retail information. The information from these source will help in calculating accurate tax returns for businesses.

Indonesia : Utilizing Drones to plug tax leaks

Indonesia is the world's largest island country with over 17,000 islands, it is also one of the world's largest producer of tree crops such as rubber, palm oil, coffee, cocoa and spices. Due to the nature of its geography, you can imagine how difficult a task it would be for the Indonesian government to tax returns from agriculture and mining operations. Remote areas on the islands of Sumatra and Borneo, where most of the palm oil trees are grown, are difficult to access and the government can’t afford a dedicated satellite or helicopters.

To solve this problem, it was reported in 2015 that drones are being utilized to catch cheats who under report the size of their plantations or the extent of their mineral extraction. Drones are alot more precise, unlike the satellite images , which are often obscured by clouds or not detailed enough. The drones that fly over the plantations, take pictures every five seconds and this information is then computed into a map. An analysis is then carried out comparing the mapped data with tax returns submitted by companies. The same report also mentioned that an oil palm planter had to coughed up 250 million rupiah in taxes due to the drone implementation.

Singapore: World's First Electronic Tourist Refund

Tourism is a key component of the Singapore Economy, In 2016, tourist arrivals hit a record high of 16.4m and spent S$24.8 Billion. In 2012, To strengthen Singapore's position as a premier tourist destination, the Inland Revenue Authority of Singapore (IRAS) did away with the conventional paper-based process of applying for a refund of GST (Goods & Services Tax) or VAT (Value Added Tax), being the first country in the world to implement an Electronic Tourist Refund system.

Instead of queuing up at refund booths, self-help kiosks are available at the airport for tourists to claim the rebates. To receive the refunds, shoppers have to choose a credit card as a token - to which all their purchase details will be tagged automatically- and then present that same token at the kiosks, which will directly credit rebates into the same credit card account. Cash refund options are also available on the kiosk.

This electronic system has drastically reduced the time taken to claim a refund from 20 minutes to a mere 3 minutes. Visitors can enjoy shopping in Singapore without worrying about keeping track of multiple refund forms for subsequent refunds on departure.

As seen by the examples above, technology can play a big role in enhancing public services. Join the discussions, as Public Service Agencies around ASEAN share their thoughts in the panel on "IoT in Public Services" at Asia IoT Business Platform.

The 2017 editions of Asia IoT Business Platform will be in Thailand (24-25 Jul), Malaysia (27-28 Jul), Philippines (1-2 Aug) and Indonesia (7-8 Aug).


By Ernest Ho | May 1st, 2017

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