Successfully and systematically implementing a tax system is not merely a matter of technology; it is a process that requires coordinated and balanced development and changes among all stakeholders, including the tax authorities, taxpayers, those involved in the tax system, and related departments and organizations.
In reforming the tax system, eight strategic plans for ensuring a systematic approach is being implemented, updating laws in line with the modern era, restructuring the organizational framework of the tax authority, modernizing the tax assessment system, making extensive use of ICT technology, effectively supervising tax compliance, enhancing the capacity of tax officials, promoting the ethical standards and integrity of tax officials, and overseeing and managing tax system reforms.
In the 2025-2026 financial year, approximately 75 per cent of the State’s total tax revenue was collected through the implementation of the Self-Assessment System. At these offices, the digital-based Tax Revenue Management System has been implemented for tax administration. The internationally standardized Taxpayer Identification Number registration system has also been introduced. Measures have been taken to enable taxpayers to fulfil their tax obligations online through e-Registration, e-Filing, and e-Payment systems. In addition, linkages have been established with MyCO (DICA), MACCS (Customs), CBM-NET (Central Bank), and TradeNet 2.0 to obtain real-time information.
Enhancing tax compliance requires supervision and management through laws and technology. Furthermore, as it is necessary to widely conduct tax awareness education so that taxpayers understand that paying taxes is a responsibility befitting responsible citizens and a fulfilment of their duties to the State and fellow citizens, arrangements have been made to incorporate tax-related knowledge into basic education curricula in order to promote and strengthen a culture of tax compliance.
As a result of these efforts, in the 2025-2026 FY, the Ministry of Finance and Revenue collected K14,070 billion in various taxes against the revised target of K13,460 billion, achieving 105 per cent of the target. Similarly, the Union’s Tax-to-GDP Ratio increased from only 5.07 per cent in the 2020-2021 FY to 8.55 per cent in the 2025-2026 FY.
“Section 389 of the Constitution stipulates that “Every citizen has the duty to pay taxes to be levied according to the law.” In order to ensure the full collection of tax revenues within the State’s tax system, it is necessary to make continuous efforts step by step, in accordance with the Tax System Reform Strategy, to increase tax revenue collection, promote use of information and technology, and enhance the tax awareness and tax culture of both tax officials and taxpayers.
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