Thailand
Thailand: Agency uses technology for tax cheats
The Revenue Department is warning corporate taxpayers that it has already adopted data analytics and a risk-based auditing system that can better track the accuracy of tax payments.
The tax-collecting agency is using high-tech software to evaluate the financial position of operators relative to their industry peers, using data analytics and a risk-based auditing system to create a balanced scorecard to analyse tax payments of those classified as risk groups for tax avoidance, said Kriengsak Prasongsukkarn, deputy director-general of the department.
Risk groups that must be examined seriously include businesses with more cash transactions, those recording low income but high inventory, or loss-making firms that lend to their board of directors.
Mr Kriengsak said data analytics has revealed the top 10 businesses that are risks for understating tax: businesses that have high cash transactions; those that inaccurately record inventory; those with either high assets or holding very few assets; those offering large loans to directors but no explanation for such transactions; those afflicted by losses for a long time; those with fraudulent financial reporting of income; those with incomplete revenue records; those with higher expenses but lower income; those reporting high expenses relative to income; and those recording fraudulent expenses.
Take certain hotel operators as an example. Data analytics has shown that a large hotel pays high electricity bills but reports low income, Mr Kriengsak said.
With information sharing among several state agencies, the Revenue Department can sort out companies that understate tax payments, he said.
The country’s largest tax-collecting agency managed to garner 823 billion baht in tax revenue during the October-to-March period, up 6.9% from a year earlier and exceeding the target by 118 million baht.
For fiscal 2020, the Finance Ministry wants the department to collect 2.1 trillion baht in tax.
The department is offering a chance for small and medium-sized enterprises (SMEs) to sort out their financial accounts during 2016-17 in return for a waiver of late payment penalties, and 26,000 SMEs have signed up for the scheme so far.
The registration will run through the end of June.
SMEs with income of up to 500 million baht a year are qualified to join the scheme.
Source: https://www.bangkokpost.com/business/finance/1676496/agency-uses-technology-for-tax-cheats