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Reinventing the revenue agency for millennial taxpayers

Millennials expect effortless omnichannel experiences. Agencies, take heed.

By David Regan

INTRODUCTION

Imagine filing your taxes from your smartphone. The form is pre-filled with your data by the revenue agency, and you can clarify any questions by checking an interactive FAQ or by live-chatting with a revenue agent. Taxes are filed at the tap of a finger and the refund slotted for automatic deposit into your checking account.

This may not be just a pipe dream for long. Tens of millions of taxpaying Millennials across the globe want instant online access to anything and everything. Whether banking, buying music or filing taxes, getting the digital mix right increases satisfaction substantially among this key—and sizable—constituency. And revenue agencies are next in line to reimagine their services in order to quench Millennials’ thirst for user-centered digital services.

The good news is that revenue agencies are already using digital technologies to improve taxpayer services. For instance, the Australian Taxation Office boosted its ability to interact digitally with taxpayers, providing citizens with efficient payment, processing and communication options.1 And the New Zealand Inland Revenue Department is building a new platform that puts taxpayers at the center of processes, enabling greater automation and more timely and coordinated communications.2 Still, with only 47 percent of taxpayers globally using digital as the main channel for filing their returns and paying taxes, there is plenty of work yet to be done.

A GENERATION WILLING TO STEP UP

Millennial taxpayers expect paying taxes to be as simple as ordering groceries or clothing online via a mobile device.3 Accenture research revealed that only about half of all young taxpayers are satisfied with the time it takes to find tax information, and that fewer than two-thirds are satisfied with the available digital means of contacting their revenue agency.4

Moreover, young taxpayers, while more digitally savvy than most of their older fellow citizens, are generally less confident about their tax-related knowledge, our research showed. Only four out of 10 (40 percent) are confident about their tax expertise, or even that they are paying the correct amount in taxes. Satisfying modern taxpayer needs—mainly speed and ease—requires a shift to a client-first mindset that will ultimately help increase taxpayer engagement and certainty about their tax obligations.

And as Accenture data shows, a whopping 82 percent of Millennial taxpayers are ready to step up and road-test digital new services. By taking advantage of this willingness, agencies can set the course for a simpler, more streamlined and engaging digital experience that will help young citizens file taxes with greater confidence and accuracy.

DIGITAL AND CUSTOMER-CENTRIC FOCUS GO HAND IN HAND

The first step? Think like a consumer company. Apple and Amazon have a deep understanding of their customers and do everything they can to remove any obstacles blocking their way to a seamless digital experience. Don’t forget that their customers are also taxpayers—and that their expectations span the channels. Here are some ideas that revenue agencies can consider to meet Millennials’ digital expectations.

  1. Imagine a wider range of digital capabilities

    Millennials desire an experience in which they can consistently and seamlessly move between channels. The critical elements to high customer adoption include providing the right depth of information on the right channels, ensuring that the information presented is trustworthy and accurate, and providing ease of access and use.

    Taxpayers, young ones in particular, are keen to see personalized solutions that foster compliance—intuitive websites that display well on various mobile devices, with clearly organized, simple information and answers. At the same time, they want the option of live interactions with knowledgeable agents for more complicated requests, similar to banking customers who choose mobile and online transactions for simple needs but still want high-touch, in-person services for complex needs.5

    What if three out of every five taxpayers did not have to file a return?

    Singapore is making it happen. As a result, 1.4 million Singapore citizens benefit from the convenience of pre-filled employment income information in their online returns.6 Add to that mix easy smartphone filing and a tool that offers immediate confirmation on eligibility for certain reliefs—and the agency has a recipe for streamlined, less costly, more hassle-free tax filing.

  2. Crowdsource

    From toy design to new menu combinations, Millennials are used to—some might even say they expect—being asked for their ideas and opinions. Recruiting taxpayers to the ideation and testing process could bring much-needed benefits. In 2010, the U.S. government launched Challenge.gov, an effort to collaborate with the public—including offering prizes as incentives to participate—to address the most pressing local, national and global challenges. By October 2015, more than 250,000 citizen problem solvers had participated in 460-plus challenges, a remarkable level of civic involvement by any standard.7

  3. Take incremental steps

    The art of the possible includes the agency pre-filling forms, requiring only a light final touch by the taxpayer. According to Accenture data, nearly two-thirds of taxpayers whose tax returns are not or only partially pre-filled desire a higher level of pre-filling.8 In countries including France, Spain, Belgium and Denmark,9 pre-populated forms mean tax filing can take less than 10 minutes. The taxpayer simply logs into his or her account, verifies the income and allowance data sent directly to the government in advance, and decides where any refund should be deposited. Already adopted by almost half of the world’s revenue agencies,10 the pre-filling solution could help reduce the tax gap and lower core agency processing costs—improving revenue collection and operational efficiency.

    But there are more benefits to be gained from a digital ecosystem. Smart agencies are taking advantage of the benefits of a digital ecosystem. Providing third-party partners with a gateway to information, such as refund and payment status, means tax intermediaries can send notifications to their customers, easing the burden of taxpayers searching for this information or contacting the agency to resolve issues or answer questions. Agencies could also integrate tax services within third-party software applications. By integrating tax reminders, useful content and real-time withholding transactions within accounting and tax software, users could better keep up with their taxable activities throughout the year.

    Another opportunity? Customer service at many revenue agencies today is provided primarily through human or static responses, and makes only limited use of automation and artificial intelligence (smart platforms that learn over time). Yet in other agencies, intelligent learning platforms are increasingly being used through both online and phone virtual agents to enhance user search capabilities and answer simpler customer queries. This can reduce the demand being placed on live agents within the contact center, making customer service more accessible and cost effective. And it would help the almost half of all young taxpayers who are dissatisfied with the time it takes to find tax information.

DIGITAL MAKEOVERS WORK

With a young, digitally adventurous clientele desiring more digital services and willing to help road-test them, agency heads have a rare opportunity to shave costs, increase efficiencies and improve collection. As Singapore, Australia, New Zealand, Denmark and others have demonstrated, there are concrete examples of digital revenue agency operations that succeed.

It’s a whole new world when looked at from the Millennial perspective. And smart revenue agencies are already seeing it.


1https://www.accenture.com/t00010101T000000__w__/au-en/_acnmedia/Accenture/next-gen/acn-au-ato-digital/Accenture-ATO-Credential-PDF.pdf

2Accenture Technology Vision for Revenue Agencies: Five Trends Shaping the Future,” 2015

3http://www.economistgroup.com/marketingunbound/consumers/accenture-channeling-liquid-expectations/

4This and all subsequent statistics sourced from: The Accenture Taxpayer Survey, 2015, unless otherwise noted.

5http://www.slideshare.net/accenture/revenue-agencies-stepping-in-the-digital-footprints-of-banks-and-insurers

6http://www.straitstimes.com/business/invest/filing-tax-returns-less-taxing-now

7https://www.whitehouse.gov/the-press-office/2015/10/07/fact-sheet-administration-celebrates-five-year-anniversary-challengegov

8The Accenture Taxpayer Survey, 2015

9http://qz.com/628020/filing-your-income-taxes-is-a-pain-and-that-is-not-an-accident/

10http://www.keepeek.com/Digital-Asset-Management/oecd/taxation/tax-administration-2015/the-use-of-online-services-in-tax-administration_tax_admin-2015-11-en#page2

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Author

 

 

David Regan

is a managing director in Accenture's Health and Public Service industry practice and the Global Revenue Industry lead.

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