A systematised review of the literature related to digitalisation and tax administration

Abstract

Background: Tax administrations are faced with a challenge that has rapidly increased in magnitude over the last few years, termed digital disruption (Autio, 2017:1). This disruption has seen businesses digitally transform the way in which business is conducted and the underlying processes to business operations. Tax administrations’ response to digitalisation could be seen as a means to remain relevant in a world that is going digital and reap the benefits of digitalisation. Main purpose of study: The purpose of this study is to perform a systematised review of the literature related to digitalisation and tax administration. This study looks at tax administrations and their reasoning for adopting digital platforms, the methods undertaken to transform digitally, and how the digitalisation can ease the tax compliance burden on taxpayers, more specifically Small, Medium and Micro enterprises (SMMEs). Method: A systematised review is performed on literature obtained from quality journals. The literature was obtained through a search in the university provided databases, namely ProQuest and EBSCOhost, using the main constructs of this study. The main constructs are digitalisation, tax administration and SMMEs. The search for the literature was limited to five years starting 2015 and ending 2019. The year 2020 was excluded from the search criteria as the research study commenced in February 2020. This posed a limitation on the number of published quality literature related to the study from the year 2020, thus the research study uses the years 2015 to 2019. Results: The search for literature using the main constructs and keywords formulated from the main constructs, from 2015 up until and including 2019, resulted in 64 articles. 35 articles were selected for use, as they were journal articles published in quality journals. Conclusions: The review indicated that there are a number of benefits associated with digitalising tax administrations. It was also noted that there are challenges with the current tax administration that are a hindrance to SMME tax compliance. These challenges should be addressed prior to moving to digital tax administration methods to ensure that they do not amplify the levels of non-compliance.