“TAKO – Moms” is the result of a project with the goal of developing a Minimum Viable Product to help tax administration service workers with customer service. TAKO is an online overview of all customers, which was created by the service workers themselves in collaboration with programmers. This process resulted in both exceptional improvements in the payment of VAT’s as well as large evolutions in the skills of the workers, without launching a high-cost project.
For many years, one of the most important jobs of any tax administration, has been servicing the tax paying citizens and corporations. Taxes are a complicated matter, and for this reason many tax payers call the administration for help or with questions. In the Danish administration, handling these inquiries have caused major challenges for the customer service workers, with regards to VAT’s. These challenges originated, in part, from a lack of overview of all tax issues. This meant, that every inquiry caused service workers to look up many different online channels, just to service a single taxpayer.
In 2016 a project to solve these challenges was set up. The goal was to examine the possibility of developing a Minimum Viable Product, which gathers all tax payer information in one overview. The product was created to cause instant improvement in the services, as well to serve as a benchmark for future improvements in this field.
The project was initiated by the customer service workers themselves with the hopes of receiving new software to support their work. However, as the newest software solutions in this area are costly, the project was limited to developing a cost-free solution. Inspired by the newest software solutions, a series of smaller-scale procedures were performed, with the service workers working side by side with IT-developers.
These procedures resulted in “TAKO”, an online overview of all VAT-related information regarding every taxpayer or corporation. Its goal was to improve the conditions of the service workers, and thereby also the taxpayers. It made it easier for the service workers to answer VAT-related questions and improve the taxpayer’s knowledge of their current situation. This is because the old process required the workers to investigate several different systems to view all available information.
TAKO is a product of many pre-tests, several tests with control groups and, importantly, cooperation between experienced service workers and newly hired developers. This cooperation was the foundation of the entire project and allowed for a great product.
All the involved parties received technical knowledge and understanding of tax related processes, all of which have been used to support projects in other departments. The fact that the project was openly a Minimal Viable Product allowed space for experimentation and exploration inside the evaluation framework.
Additionally, TAKO resulted in a rise in both the payments of VAT debt, as well as an increasing fraction of firms with registered contact information. The latter fraction saw a rise by 26 percentage points after implementing TAKO. The effect of TAKO was measured in the fraction of firms who were debt free regarding VAT’s 4 weeks after contacting the administration. This fraction was 8 percentage points larger after implementing TAKO compared to previously.
In conclusion, TAKO allowed for a low-cost solution to a very large problem. Not only did the project improve the fraction of corporations who pay VAT’s on time, but also educated tax workers in several areas. The knowledge gained from working with TAKO has been an asset in several other projects. The latter result is essential, as it clarifies the project as a success, and allows TAKO to serve as a benchmark for future projects, both in the tax administration and in other government agencies.
What Makes Your Project Innovative?
Usually, achieving large improvements in tax payments have been the result of large-scale IT-projects with high costs. In this project, that was not the case. Starting out as the development of a minimum viable product, the projects innovative way of working allowed for great results. With service workers and IT-developers sitting side by side through the entire process, the experience, which both parties gained, has become a valuable asset to the Danish tax government in many other projects. Especially, the technical knowledge regarding tax administration, which the IT-developers gained from working alongside service workers has proved a valuable return from the project.
What is the current status of your innovation?
The project has already been closed and evaluated. The knowledge gained from working with "TAKO - Moms" is being used in other projects, and the same method of working has been applied elsewhere in the tax administration.
The success of TAKO has inspired other departments of the administration to use the same methodology, which means that TAKO was a success on multiple fronts: both improving the number of tax paying corporations as well as serving as a benchmark for other projects.
Collaborations & Partnerships
IT-developers: Contributed with programming the product itself.
Service workers: Their technical knowledge regarding tax administration was essential in helping design the product and educate IT-developers.
Tax payers: They were not directly involved with development, however the product is developed according to the questions from tax payers, as well as the challenges which these provide.
VAT-management: Responsible for providing business strategy for the project.
Users, Stakeholders & Beneficiaries
Tax Payers: Receiving guidance on paying the correct taxes are now easier than ever.
Service workers: The work with guiding tax payers has been made easier due to TAKO itself.
Tax administration in general: The technical knowledge received by the IT-developers provides an asset for the rest of the administration, whenever they cooperate with developers on a project.
Results, Outcomes & Impacts
The process has resulted in several improvements in the payment of VAT’s as well as the fraction of corporations with information registered at the tax administration. Concretely, these have seen a rise by 8 and 26 percentage points respectively. These numbers are expected to increase further in the future. Additionally, the experience gained from the innovation process is expected to improve efficiency in multiple areas of the tax administration work in the future.
Challenges and Failures
When the project was initially set up, the thought was that the solution would be implementing the digital overview using robotics. However, as this was developed, a test of usability showed, that this system would fail. This caused management to investigate other options, where the minimum viable product solution was selected.
Conditions for Success
In order to develop digital solutions, there are multiple important factors to consider:
• It must be clear from the beginning of the project, that the process itself is as important as the end goal. This leads to an open work space, which allows for examination and testing of multiple solutions. This causes the product to be the best possible, as all methods have been considered.
• The cooperation between product users and developers maintain a high priority throughout the entire project. When everyone involved has a common understanding of both the challenge to be solved, as well as the knowledge needed, the room for creativity becomes larger.
• Both above points must be anchored in management. If management agrees that the process is of equal importance to the product, no hasty decisions will be made, and the quality of the product will improve.
An approach similar to that of TAKO is currently being tried elsewhere in the tax administration. IT-developers working side by side with the workers who is to use a system every day, is something which could improve both concrete results and the experiences of workers. This was the case regarding VAT’s with TAKO, but it should also be applicable in other parts of administration.
The main point separating TAKO from other projects in the tax administration is the way the product was developed. The way that everyone involved worked side by side instead of it being brokered by external parties, optimized both the process and the product.
- Diffusing Lessons - using what was learnt to inform other projects and understanding how the innovation can be applied in other ways
5 January 2021