The head of the parliamentary committee on finance, tax, and customs policies, Daniil Hetmantsev, has submitted registration of bills to the Verkhovna Rada aimed at establishing key performance indicators (KPIs) for customs and tax authorities (cards 1763587 and 1763579).
“The bills propose to introduce an assessment of the efficiency and effectiveness of the activities of tax and customs authorities to enhance transparency and accountability, optimize decision-making processes, and eliminate operational shortcomings,” - wrote Hetmantsev on his Telegram channel on Monday.
It is explained that such an assessment will be based on KPIs defined by the Ministry of Finance, which will be published on the websites of the State Tax Service and the State Customs Service. Based on the assessment results, the State Tax Service and the Customs Service will prepare reports that will also be disclosed on the authorities' websites.
The bill regarding KPIs for the tax service implies defining the concept of “tax gap” and introducing annual calculations and disclosures of this indicator, defining the concept of “key performance indicator for tax authorities” (KPI), and establishing requirements for KPIs, as well as introducing the IMF-recommended classification of KPIs for the State Tax Service - strategic (lasting more than one year) and operational (annual).
The bills also provide for establishing a connection between the individual assessment of an official's performance and the evaluation of the State Tax Service’s activities, as well as regulating the procedure for quarterly disclosure of information on KPI performance for the State Tax Service.
In addition, it is proposed to designate the year 2025 as the first reporting period for assessing the efficiency and effectiveness of tax authorities, and considering best international practices (TADAT) and recommendations from international organizations (IMF, OECD), the document offers a list of recommended KPIs for the State Tax Service.
The project for introducing KPIs for customs envisages defining two types of assessments: internal (conducted by the Customs Service based on KPIs developed by the Ministry of Finance) and external (conducted by independent experts appointed by the Cabinet based on proposals from international and foreign organizations).
Furthermore, the customs-related bill provides for creating favorable conditions to facilitate trade and develop competition, administer customs payments, protect society, public health, and environmental safety, and combat the illegal trafficking of narcotics and weapons, as well as organizational development of customs authorities’ activities.
“The Ministry of Finance is recommended to take into account the mechanism for measuring the effectiveness of customs administrations (WCO Performance Measurement Mechanism), developed by the World Customs Organization when defining KPIs for customs,” - added the head of the finance committee.