Chapter

II. Planning for VAT

Author(s):
Alan Tait
Published Date:
June 1991
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Graham Holland

This chapter considers, from the perspective of management, the process by which an organization actually implements a VAT. It identifies and discusses issues that senior administrators would need to address as soon as it has been decided to proceed with a VAT. That is, this chapter aims to answer the following general questions:

  • What has to be done to implement the tax?
  • How many people will it take?
  • How long will it be before we are collecting tax?

The Development Unit

Assuming that it has already been decided which department will administer the VAT (see Chapter V), the management of that department must first consider what organizational structure or approach to adopt for introducing the VAT. The main choices are (1) to use the existing structure; (2) to establish a separate unit; (3) to contract the task out to private sector consultants; and (4) to adopt a mixture of the above. Each of these options is discussed below.

Using the Existing Structure

Under this option, all activities associated with implementing the VAT would be performed under the direction of existing divisions of the department’s head office. For example, the current training branch would be responsible for training and the existing computer division would handle all aspects of computerization.

The benefits of this approach are (1) those branches that will have to deal with the VAT on a daily basis will become knowledgeable about the operational and legal issues; (2) staff may be able to start working on VAT issues immediately; and (3) there is likely to be an existing concentration of expertise in those areas.

The difficulties of this approach are (1) since work on issues other than VAT is unlikely to diminish (and may even increase if VAT is introduced as part of a reform package), existing resources may be stretched too thinly to handle all tasks; (2) if managers have to work on both VAT and other issues, VAT is unlikely to receive the attention it warrants; (3) coordination among the various divisions responsible for implementation becomes difficult and will tend to be escalated to a higher level than necessary; (4) the different nature of the VAT from existing taxes being administered is more likely to be overlooked, and the chances of innovative responses to operational and legal issues are reduced; and (5) accountability for the successful implementation (or mistakes) is diluted.

Establishing a Separate Team

This option would involve taking officers out of their current divisions and organizing them into a separate team under a very senior manager whose only responsibility would be to implement the VAT.

The advantages are (1) if resources are drawn from a wide enough area, regular tasks can continue with minimum disruption as managers and staff of existing sections will not be directly involved in the effort; (2) because specific resources must be committed to it, the introduction of VAT is recognized as an important and, indeed, a crucial task; (3) coordination of each aspect of the VAT development is greatly eased and improved; (4) a forum is created for innovative solutions that benefits not only VAT development but also the entire organization in the longer term; and (5) accountability for success or failure is both visible and fixed.

Despite these benefits, this option is not without its problems: (1) other divisions might resent the creation of a separate team, which could make it more difficult to absorb the VAT into the parent organization after implementation; (2) too much organizational power may become concentrated in the hands of one person; and (3) it might be harder for top management to control the development of VAT.

Contracting the Task Out to the Private Sector

There are private sector consultants who would be prepared to bid for a project in which they take responsibility for all aspects of development. Generally, they would only oversee the project, supply senior staff while the VAT is being developed, and assist in selecting staff for the key positions.

The advantages are (1) it brings expertise into the organization which otherwise may not be available; (2) the time taken for the various phases of development could be shortened; and (3) accountability is very clearly fixed and might be enforced by the use of penalty clauses.

There are, however, a number of disadvantages as well: (1) the costs (including scarce foreign exchange) of development can be higher; (2) difficulties can arise once the consultants’ task is completed, since the administration taking over the maintenance of the system has not learned as much as it would have under the other options; (3) it is less likely that the organization will benefit from spin-off improvements in the non-VAT aspects of its operations; (4) consultants may be less aware of, and possibly be less sensitive to, local conditions in proposing and developing solutions; and (5) the need for the department to supply its own resources is not significantly reduced. Thus, the use of outside consultants should be seen as a way of obtaining the skills that may be lacking rather than as a way of reducing the number of personnel required.

A Combination of Some or All of the Above

The final solution probably will be some combination of the above options, and the benefits and disadvantages will vary depending on the weight given to the various elements. Selecting a combination has the advantage that it permits a customized solution to be developed that will meet the specific needs of the country and the administration. However, problems relating to accountability and to the difficulties of coordinating the activities of the various groups tend to be compounded by this approach.

The most successful VAT implementation activities appear to have been those that have been handled primarily by a separate VAT development unit that has been given the overall responsibility for introducing the tax. The characteristics of the better solutions adopted are as follows: (1) Overall responsibility for implementation is given to a senior officer from the department selected to administer the tax. (2) Consultants are used for specialized purposes, but they report to the controller of the development team. (3) A high-level “steering committee” reviews progress within the development unit and provides a continuing linkage between it and the parent organization. (4) Appropriate numbers of qualified staff are committed to the development unit on a full-time basis. (5) Accountability for the success or failure has been clearly fixed on the leader of the development team.

The discussions in the following sections assume that a VAT development unit has been established.

The Tasks

In terms of complexity of development, the demand for human resources, and the impact that it will have on society, the implementation of the VAT can rank as one of the most significant development projects undertaken by a country. It will certainly be one of the most demanding projects managed within the revenue service and if mismanaged could seriously disrupt the operation of the entire department.

In broad terms, three groups of tasks must be completed before VAT revenue can flow-organizational, operational, and external. The main activities are

  • Organizational—decide organizational and structural issues; secure resources; engage staff; train staff.
  • Operational—develop VAT policy and legislation; design operating procedures, including compliance; develop a computer system; prepare manuals and instructions; design forms; register taxpayers.
  • External—consult with private sector; educate taxpayers; assist in educating the public.

In the remainder of this chapter, these tasks are described and discussed in outline form, under the headings “The Activity,” “Timing,” “Principal Linkages,” and “Resource Demands,” while the most important topics are examined in greater detail in other chapters (e.g., Chapter VI—“Computerization for VAT”). For management, the important points to be noted are the following: (1) All these responsibilities should be under the overall control of the manager of the development team. (2) Each area of activity will require certain resources, but these will vary at different times, depending on the stage of the VAT implementation process. (3) There are important linkages between many of the tasks and these are covered more fully in the section “The Timetable” below. (4) Where appropriate, the timing and resource demands of each activity are indicated. These, however, are averages and would need to be adjusted according to the size of the parent department.

Legislation

The Activity. This task covers the steps needed to resolve the major policy issues, prepare draft legislation, resolve the less significant or operational policy issues that arise during the drafting process, prepare regulations if required, and pass the legislation in parliament, as well as ratify any regulations. This is a critical set of tasks for the VAT development unit which, probably more than any other, dictates the timing of implementation. In addition, this is a highly specialized activity that cannot reasonably be subcontracted and that requires a number of high caliber officers.

Timing. Work on legislation starts as soon as the initial decision to proceed with the VAT is made and continues through most of the development period. Inevitably, as soon as the legislation becomes law, work on interpretations and the preparation of amendments begins. The parliamentary process of the country and issues such as the commitment of the cabinet to the VAT and acceptance by the public can influence the time taken to pass the legislation, but it is unlikely to be completed in less than 12 months.

Principal Linkages. Although there are a number of tasks that must begin well before the legislation is passed, some cannot be completed until the law is final. For example, registration, the final printing of forms and guides, and certain advertising require the law to be in place.

Staff Needs. Many countries now have effective VAT legislation and by careful study of these the number of staff needed for initial drafting can be reduced. The process does, however, require officers experienced in drafting either sales tax or income tax legislation, as well as some who are experienced in resolving policy issues. Possibly, three officers should be assigned to these tasks. Later, they will help to prepare staff manuals and training and explanatory material.

Consultation, Publicity, and Education

The Activity. It is fundamental to the success of VAT that (1) private sector individuals and groups with vested interests are encouraged to contribute to its development; (2) proper publicity is given to the reasons for the introduction of VAT and the benefits; and (3) individuals and organizations with responsibilities under VAT have their responsibilities and obligations carefully explained.

As regards consultation, experience shows that the best tax reforms involve participation by the private sector in both policy and operational issues. The benefits are (1) consultation develops commitment and support for the effective implementation; (2) the potential for litigation in the legislation can be identified and corrected before the bill becomes law; (3) provisions or procedures that are unduly complex, difficult for taxpayers to comply with, or that are unnecessary can be corrected; and (4) forms and procedures can be tested by taxpayers and their agents before printing.

All major national associations that represent potential VAT registrants should be consulted in the development of the legislation before it becomes law. Other matters relating to operational issues and taxpayer education should also be discussed with them and with others such as employers’ associations.

Consultations should be both formal and informal. The formal consultation process differs in detail from country to country, but essentially amounts to the minister of finance or his counter-part releasing a statement outlining the main features of the proposed VAT and including, if possible, draft legislation and inviting comments from members of the public and the main business organizations within a reasonably tight deadline. Either VAT officials or a joint private sector/ government review committee would then recommend changes to the minister on the basis of these comments. At the same time, VAT officials should maintain continuous contact with private sector representatives to discuss issues relating to the drafting of legislation and the return and payment processing procedures to be applied.

Publicity refers to providing information to the general public and not to the process of informing or educating taxable persons. Public acceptance of and support for the introduction of the VAT are important if there is to be good compliance. When VAT is announced and during its development, there will be vigorous debates about its effects on prices, the compliance costs for traders, and its potential regressiveness (see Chapter I). These will need to be discussed openly and countered with publicity outlining the benefits of the reforms. The government and officials must face up squarely to all the issues. Besides, irrespective of public criticism, all consumers have a right to be aware of the likely impact of VAT on prices, of the part they play in its operation and, for example, of any remedies they might have if they suspect profiteering or overcharging during the transition to VAT.

Those in charge of tax administration normally do not conduct this type of publicity, as it amounts essentially to policy justification. In a number of countries that have successfully introduced VAT, the minister of finance has associated himself publicly with the tax and has played a major role in promoting its acceptance. Typically, such involvement would be concentrated in the early stages of the development period and around the date of implementation. Heavy use should be made of television and newspaper advertising and ministerial speeches to carry the VAT publicity message. The minister’s publicity officer could be responsible for publicity, possibly supported by additional staff engaged solely for this purpose. Alternatively, the responsibility could be sub-contracted to consultants. This team would also be responsible for producing general pamphlets and other material aimed primarily at the consumer. The VAT development unit’s responsibility would be limited to verifying the technical aspects of the material produced and coordinating with its own publicity and advertising.

The VAT development unit’s responsibility for trader education is mainly to ensure that taxable persons are aware of their obligations. Some examples follow.

  • Pamphlets

The VAT development unit should produce a guide to “Registration for VAT” to be available to all persons. This type of pamphlet contains all the information needed by a person to decide whether or not to register. It is made available to anyone on request, but ideally should be mailed individually to anyone expected to register (identified by reference to income tax and third party information). A “VAT Guide” that fully explains the law and the operating procedures should also be available to everyone and is automatically sent to all who register for VAT. Some administrations prefer to issue a series of smaller guides but, at least in the early stages, a simple comprehensive document is preferable.

Special pamphlets can also be prepared on topics of limited or specialized interests. For example, a small pamphlet dealing with “VAT and the Farmer” could be valuable in explaining obligations to that type of taxpayer. Other examples include pamphlets dealing with the construction industry, specific occupations (e.g., lawyers), or specific aspects of VAT operation, such as treatment of credits, capital goods, and special schemes for retailers. Selected distribution lists could be developed for such material (e.g., through the department of agriculture).

  • Advertising

The VAT department should advertise on television and radio and in newspapers around the key dates in the development timetable to remind taxpayers of their obligations and what they must do.

The key activities would be the opening and closing of the consultation period, the beginning and end of the registration period, the implementation date, and the first return and payment dates.

  • Seminars

The VAT development unit should seek all opportunities to address business conferences and seminars to explain the operation of VAT. It should also work closely with the main professional bodies, assisting them to organize training sessions and seminars. In addition, officers of the unit should make public presentations in all major centers so that those who cannot attend the private sector seminars may learn about the operation of VAT. Centrally prepared “speaking kits” including speech notes and visual aids can assist in ensuring consistency. Some training in public speaking may also be needed.

  • Advisory Visits

A number of countries have found this to be the most effective education method available to the VAT department. Officers should visit as many taxpayers as possible in the period between the registration date and the implementation date and on a one-to-one basis explain in detail the taxpayer’s obligations, show how to complete a VAT return, and answer any questions the taxable person may have.

Potential taxpayers who wish to have an advisory visit are asked to indicate this on the registration form. Priority is given to those requesting a visit, with, ideally, all others receiving an advisory visit within 12 months. While this is a very effective way to educate taxpayers and also benefits the VAT department in terms of better compliance, it does require a large number of staff. The most appropriate group of officers to use are those who will ultimately conduct audits as the discussion and negotiating skills required for the two tasks are similar. An important implication of this approach is that the majority of the recruitment of staff and their training must be completed before registration starts, that is, well before the implementation date.

Timing. Work on all these activities continues throughout the entire development of VAT although there are periods of concentration. The first task is to develop the informal consultation network (if not already in place from experience with other taxes). The formal consultation is probably the second major task, with work on the preparation of pamphlets and guides reaching a peak when the formal consultation is complete and therefore the policy and legislation are more certain. Advertising is centered around the key dates mentioned, while the seminars would probably start as soon as the VAT is announced and steadily increase until the registration is almost complete. The advisory visits start early in the registration period and are likely to extend well beyond the implementation date.

Principal Linkages. The linkages between these tasks and the development of legislation, operating procedures, and forms have already been covered. Linkages between the advisory activity and training and the preparation of manuals are covered below.

Staff Needs. The main requirement is for staff who will be associated with the advisory activity, and this could be met from the pool of staff engaged for the ongoing administration of the VAT. In addition, specialized assistance will be needed to prepare publications, advertising copy, and articles for magazines, and this may be best satisfied by hiring a journalist.

Organization and Staffing

The Activity. Once the main decisions have been taken on the policy, legislation, and operating systems, the VAT staffing needs can be estimated with reasonable precision. Various administrative matters will then have to be tackled; these relate to staffing, including recruitment, job grading, and job descriptions, as well as securing accommodation and transferring staff. While these tasks are essential to VAT development, they are not always conducted by the VAT development unit. Some believe that such specialized tasks are best handled by the administrative arm of headquarters leaving the implementation unit free to resolve the technical and operational issues.

If that course is adopted, close coordination will be needed between the leader of the implementation unit and those dealing with staffing and organizational issues, and the administrative section will need to be prepared to commit staff full time to this activity.

Timing. The implementation of the VAT will almost certainly require relatively large numbers of staff to be recruited or transferred from other duties. It can take many months to decide on the number of staff needed, obtain the necessary approvals to recruit staff, and to select and appoint staff. Often, the public service commission or a similar body is in charge of recruitment and simply is not geared to a major task such as this. Existing recruitment procedures may need to be either overhauled or circumvented so that the right numbers of staff are in place at the right time. Coordination at a high level between the administrative unit at headquarters and the VAT development unit will be required on this issue.

The timing of staff recruitment will vary, but generally the majority of the staff will need to be engaged and allocated to VAT duties at least a month before registration starts. This means that most will be in place up to eight months before the implementation date.

The timetable envisages that staff will be recruited or transferred to VAT activities in four main stages. First, the managers and supervisors are assembled so that they can be trained early and become involved in the selection and training of their own staff. Second, the auditors and initial processing staff are recruited. The auditors will be conducting the advisory visits and thus must be in place and trained before registration starts. The initial processing staff to handle the registration are also recruited at this time. Third, the balance of the processing staff and the main body of data entry staff will be recruited in time to handle the first returns. The final stage is the recruitment of debt collection staff who will not be needed until the first defaulters have been identified. No separate support staff recruitment is needed at this stage.

Principal Linkages. There are important linkages both backward and forward. As to the former, the most crucial prerequisites to the calculation of staffing needs are decisions on major policies and operating systems and the estimate of the number of taxpayers. In the other direction, clearly it is important that recruitment of staff proceed according to a rational plan so that sufficient staff can be trained in time to register taxpayers and to conduct advisory visits before the implementation date. These are reflected in the timetable given in Annex I.

Staff Needs. Initially it may require only one or two persons working full time on this task, but larger numbers will be needed as the main recruitment activity commences.

Training

The Activity. The task of the VAT development unit is to develop the overall training concept and the basic material or training packages and to design the ways in which training will be organized. Ideally, the task of training the main body of staff should be the responsibility of local management, leaving only the training of the managers or initial trainers to be conducted by the VAT unit.

This is a major task, and to appreciate its size it must be understood that virtually none of the existing training material in any government department will be relevant to VAT. While it is possible to adapt some overseas material to shorten the production time, the VAT development unit faces a major task in preparing a wide range of training material.

Timing. The process of developing the training concept through to final delivery will be lengthy. Ideally, therefore, training staff should be allocated to the VAT unit at an early stage.

Principal Linkages. The principal building block for the training material on specialist VAT issues is the set of manuals prepared for the use of staff. There is therefore a close connection between the staff working on the manuals and the training material. There are obvious forward linkages to the conduct of advisory visits and the ability to process registration applications, returns, and payments.

Staff Needs. Initially, at least two officers should work full time on training activities, but more will be needed later as the legislation is developed and the detailed preparation of training plans can commence. Good results have been achieved in this area by engaging external consultants to oversee this activity.

Procedures, Forms, Computer Development, and Audit

The Activity. Operational procedures must be designed to identify and register traders, process returns, record payments, issue refunds, identify noncompliers, and collect arrears. Appropriate forms must also be drafted.

An audit system must be developed to identify and assess noncompliers. The most successful VAT audit system relies heavily on financial controls and checks supplemented by physical controls, and the task of the VAT development unit is to plan the audit policy and prepare manuals and training material. The audit system is discussed in detail in Chapter VII.

Computerization is essential to the efficient and effective operation of a VAT system and the VAT development unit will be responsible, most likely with significant assistance from consultants, for all stages of computerization (see Chapter VI).

Timing. These are major tasks that cannot be accomplished in a short time and staff should be allocated to start work on these at a very early stage. Ideally, those responsible for developing procedural systems should work closely with those concerned with policy and legislation drafting and therefore should be among the first engaged. The time needed to design the computer system will vary depending on its sophistication. However, there is a tendency to underestimate the size of this task and it is therefore wise to assume that it will take at least 12 months. The timing of the development of the audit procedures is less critical than many other tasks as auditing will not start until after the implementation date (most other tasks need to be completed before registration).

Principal Linkages. The design of operational procedures and the audit system is at the core of the VAT development, as the preparation of manuals and training packages and computer systems cannot be completed without them.

Staff Needs. To a large extent, the members of the VAT development unit responsible for preparing the registration and processing manuals (see below) will also be developing the systems themselves. Additional and specialized resources are, however, required to work on computer development and possibly the design of forms (one staff member). As regards audit, an initial allocation of one or two officers able to analyze accounting records is needed.

Manuals

The Activity. Manuals are vital for an efficient VAT and are essential for consistency in decision making throughout the department, particularly at the time of introduction of a new tax. Manuals should be developed for the following operations: (1) technical issues covering the interpretation of the law, explaining its significance and the relationship between the sections of the VAT act; (2) registration procedures dealing primarily with the initial registration and the requirements for new applicants; (3) processing instructions covering such issues as the handling of returns, taxpayer records, debt collection, and computerization; (4) audit dealing with the nature of audit and the auditing procedures; and (5) advisory activity to explain what has to be done during an advisory visit.

Timing. The manuals on registration and on technical issues should be prepared early enough so that the staff engaged on trader education and registration can be fully trained before registration begins. Manuals dealing with audit and topics such as arrears collection will not be needed until later.

Principal Linkages. The principal linkage is between manuals and the training activity as the training material cannot be completed until the manuals have been fully drafted.

Staff Needs. In the early stages of the VAT development, it is probably enough to have one person responsible for preparing manuals. However, as operational and legislative issues are finalized more staff will be needed. Those members of the VAT unit involved in policy resolution and legislation drafting will need to be closely involved with this task because of their understanding of the law. Similarly, those preparing the training packages will need to work closely with those writing the manuals to ensure that the manuals are suitable for training.

Staff Needed to Develop a VAT

The majority of the staff needs at the initial development stage has already been discussed. In addition, a senior officer must be appointed to oversee the entire operation on a full-time basis. That person might also need two assistants, one responsible for legislative and policy-related matters and the other responsible for operational activities. While a somewhat flatter structure might normally be more appropriate for a team of this size, the additional layer in the organization can be justified because of the breadth, significance, and complexity of the undertaking and because the senior officer will be mostly occupied with personal consultations. A suggested organizational structure for the VAT development unit is set out in Chart 1.

Chart 1.Organization of the VAT Implementation Unit

A summary of the initial staffing needs for the first one to two months follows. These numbers are a simple guide—whereas very small, efficient administrations with a small taxpayer base may be able to develop a VAT quite satisfactorily with fewer staff, others may require more.

FunctionNumber
Controller (VAT development unit)1
Assistant controller (legislative)1
Assistant controller (operational)1
Policy development and legislation3
Publicity1
Organizational and staffing1
Training2
Forms design, manuals, etc.3
Computer systems2
Audit2
Total17

As the development of VAT progresses, many more staff will be needed on certain activities, while some of the initial staff may be assigned to other tasks. For example, those initially involved with policy development and preparation of legislation will have a major role in the preparation of manuals, guides, and training material. Similarly, the officers developing auditing procedures will also be concerned with the preparation of the advisory visit manual. It is likely that the greatest demand for staff will be for developing and testing the computer system and preparing manuals and training materials.

As regards long-term needs, some countries have found that the peak period of staffing requirements begins after the operational policy is in place and ends with the start of registration. That is, from about 6 months through to 18 months after the initial decision to implement if a 24-month development schedule is adopted. During this period, some countries have found that to handle the tasks properly, the numbers of staff allocated need to increase by as much as three times the initial level.

If the VAT is replacing an existing sales tax, the staff running that tax must be kept on for some time after the VAT has started. Later they may be transferred to the VAT. However, for a time, there is likely to be a bulge in staffing. Some countries have found that using recent revenue service retirees as temporary help over the transition period has been a flexible and relatively simple solution.

The Timetable

The time needed to develop a VAT satisfactorily will depend on a variety of factors. For illustrative purposes, we have used as a guide, a development period of 24 months from the date on which the decision to introduce the VAT is taken until the first revenue is received. The presence of some or all of the following factors could be expected to reduce this period. (1) Experience with the operation of broad-based indirect taxes; (2) experience with a tax credit mechanism; (3) existence of a modern computer system within the department, which is used as an operational tool (i.e., not merely for statistics); (4) strong political commitment to the introduction, thus ensuring a speedy passage of the legislation; (5) experience with implementing large-scale tax changes; (6) availability of high-quality personnel for developing VAT; (7) commitment of control agencies to assist in the activity (e.g., those concerned with allocation of financial resources and those responsible for approving staff increases); (8) a flexible civil service personnel policy; and (9) complexity of the VAT legislation, since the simpler the tax (fewer rates, no zero rating except for exports, fewer exemptions, etc.) the quicker and more straightforward will be the preparation of manuals and training.

The timetable shown in Annex I is in two parts. Part A is a critical path chart indicating the time period during which each of the main tasks would need to be completed given a decision to implement on January 1, 2000 and a scheduled implementation date of December 2001. Part B lists the tasks and indicates the close linkages between the various stages of the project. It shows those activities that must be wholly or largely completed before later stages can commence and also what stages cannot be started before the current one is complete.

Annex I VAT Implementation Schedule

Part A.Critical Path Chart

Part B.Duration of Tasks and Preceding Activities
ActivityScheduled Start DateApproximate DurationPreceding Activities
Preparatory to development
Decision to introduce VATJan. 20002 months
Decisions on broad principlesFeb. 20002 monthsDecision to introduce VAT
Select department to administer VATFeb. 20001 monthDecision to introduce VAT
Allocate development budgetFeb. 20001 monthDecision to introduce VAT
Establish VAT development unitFeb. 20001 monthDecision to introduce VAT
Allocate initial staff to VAT unitMar. 20001 monthAllocate development budget
Establish VAT development unit
Secure accommodation for VAT unitMar. 20001 monthEstablish VAT development unit
Appoint manuals staffSep. 20001 monthSecure accommodation for VAT unit
Draft ancillary law
Appoint computer development staffJuly 20001 monthSecure accommodation for VAT unit
Complete user specifications registration system
Appoint trainersSep. 20001 monthSecure accommodation for VAT unit
Draft ancillary law
Legislative
Decide broad operational issuesApr. 20003 monthsDecisions on broad principles
Select department to administer VAT
Allocate initial staff to VAT unit
Initial draft of VAT lawApr. 20005 monthsDecisions on broad principles
Draft ancillary lawApr. 20005 monthsDecisions on broad principles
Consult private sector on lawJuly 20003 monthsDecide broad operational issues
Issue government paper on VAT
Revise law following consultationOct. 20001 monthConsult private sector on law
Pass law through parliamentNov. 20002 monthsInitial draft of VAT law
Revise law following consultation
Draft ancillary law
Regulations
Decide need for regulationsJuly 20001 monthDecide broad operational issues
Draft regulationsAug. 20003 monthsDecide need for regulations
Consult private sector on regulationsNov. 20002 monthsDraft regulations
Revise regulations after consultationJan. 20011 monthConsult private sector on regulations
Regulations ratified by governmentFeb. 20012 monthsRevise regulations after consultation
Publicity
General private sector discussionsMar. 200018 monthsEstablish VAT development unit
Consult private sector on operationsJuly 20004 monthsDecide broad operational issues
Issue government paper on VATApr. 20002 monthsDecisions on broad principles
Provide copy for trades and professionsApr. 200010 monthsAllocate initial staff to VAT unit
Hold seminars for trades and professionsApr. 200010 monthsAllocate initial staff to VAT unit
Prepare VAT guideSep. 20006 monthsInitial draft of VAT law
Prepare registration guideNov. 20003 monthsRevise law following consultation
Prepare VAT material for consumersApr. 200015 monthsDecisions on broad principles
Prepare specific trader pamphletsSep. 20006 monthsInitial draft of VAT law
Advertising
Registration advertisingFeb. 20016 monthsPrepare registration guide
Implementation advertisingAug. 20011 monthRegistration advertising
Payment advertisingSep. 20011 monthImplementation advertising
Organizational
Decide organizational structureJuly 20001 monthDecide broad operational issues
Estimate number of taxpayersJuly 20001 monthDecide broad operational issues
Calculate staff to administer VATAug. 20001 monthEstimate number of taxpayers
Decide organizational structure
Secure accommodation and equipmentSep. 20006 monthsCalculate staff to administer VAT
Appoint managers and supervisorsSep. 20003 monthsCalculate staff to administer VAT
Appoint auditors and first processing staffDec. 20004 monthsAppoint managers and supervisors
Appoint remaining processing and data entry staffApr. 20013 monthsAppoint auditors and first processing staff
Secure accommodation and equipment
Appoint debt collection staffJuly 20011 monthAppoint data entry staff
Operational
Design audit systemJuly 20006 monthsDecide broad operational issues
Design registration systemJuly 20003 monthsDecide broad operational issues
Design return and payment processing systemJuly 20003 monthsDecide broad operational issues
Forms
Design registration application formOct. 20002 monthsDesign registration system
Design registration certificateOct. 20002 monthsDesign registration system
Design return formOct. 20003 monthsDesign return and payment processing system
Print registration application formDec. 20002 monthsDesign registration application form
Print registration certificateDec. 20002 monthsDesign registration certificate
Print return formJuly 20012 monthsDesign return form
Computer development
Decide computer ownership and structureApr. 20002 monthsEstablish VAT development unit
Decisions on broad principles
Complete user specifications—registration systemJune 20001 monthDecide computer ownership and structure
Develop registration systemJuly 20004 monthsComplete user specifications—registration system
Test registration systemNov. 20002 monthsDevelop registration system
Load registration data baseJan. 20011 monthTest registration system
Complete user specifications—ongoing systemJune 20002 monthsDecide computer ownership and structure
Develop ongoing systemAug. 200012 monthsComplete user specifications—ongoing system
Appoint computer development staff
Test and redevelop ongoing systemAug. 20012 monthsDevelop ongoing system
Manuals
Prepare technical manualOct. 20006 monthsAppoint manuals staff
Supplementary technical manualNov. 20002 monthsRevise law following consultation
Registration procedures manualOct. 20001 monthDesign registration system
Processing and procedures manualNov. 20006 monthsConsult private sector on operations
Advisory activity manualOct. 20002 monthsDesign return and payment processing system
Audit and compliance manualJan. 20012 monthsDesign audit system
Training development
Technical training developmentApr. 20011 monthPrepare technical manual
Appoint trainers
Registration training developmentNov. 20001 monthRegistration procedures manual
Return processing training developmentMay 20012 monthsProcessing and procedures manual
Advisory training developmentDec. 20002 monthsAdvisory activity manual
Audit training developmentMar. 20011 monthAudit and compliance manual
Training delivery
Technical training deliveryMay 20014 monthsTechnical training development
Registration training deliveryDec. 20001 monthRegistration training development
Return processing training deliveryJuly 20013 monthsReturn processing training development
Advisory training deliveryFeb. 20012 monthsAdvisory training development
Audit training deliveryApr. 20014 monthsAudit training development
Registration and implementation
Issue registration application formsFeb. 20011 monthPrint registration application form
Registration training delivery
Pass law through parliament
Load registration data base
Issue registration certificatesMar. 20011 monthIssue registration application forms
Print registration certificate
Conduct advisory visitsSep. 20016 monthsAdvisory training delivery
Prepare VAT guide
Provide copy for trades and professions
Prepare specific trader pamphlets
Prepare VAT material for consumers
Technical training delivery
Hold seminars for trades and professions
Issue registration certificates
Issue first return formsJan. 20021 monthPrint return form
Issue registration certificates
Test and redevelop ongoing system
Receive paymentsFeb. 20021 monthIssue first return forms
Supplementary technical manual
Return processing training delivery
Payment advertising
Regulations ratified by government
Identify defaultersMar. 20021 monthReceive payments
Pursue defaultersApr. 20021 monthAppoint debt collection staff
Identify defaulters
Ongoing operation
Commence VAT auditsMar. 20021 monthAudit training delivery
Receive payments

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