“Transforming Tax Systems with Blockchain” focused on how tax authorities can use blockchain in conjunction with other technologies to improve tax compliance.

Representatives from government, academia and private sector (regional and international) share their expertise, supplemented by real-life examples of how governments have used blockchain technology in countering illicit financial flows and improving tax compliance.

TaxCore® and the proof-of-audit

Data Tech International was fortunate to be invited and present to the panel Proof-of-Audit function, which is a confirmation from the TaxCore® that all the invoices issued with a particular secure element (one taxpayer can have more secure elements) have been stored in its database. The platform issues a proof-of-audit after each fiscal invoice (remote audit) or after a group of delayed invoices reaches the database (remote audit facing technical issues or local audit). It also confirms that exactly the same data entered in the taxpayer’s POS and transferred to the tax authority database.

However, not receiving a Proof-of-Audit does not immediately prevent the taxpayer from issuing new fiscal invoices.

The taxpayer can continue issuing fiscal invoices without a Proof-of-Audit but there is always a preset limit until when the solution can delay a Proof-of-Audit.

This setup forces taxpayers to report regularly – even if the internet failure prevents normal invoice transmission to the database, the platform will inform the taxpayer that the preset limit is approaching. He/she can then perform a local audit in order to obtain a Proof-of-Audit from the tax authority.

Other speakers contributed with their own views and presentations to make this conference, once again, successful:

Thanks to Jeffrey Owens and Daniel Prud’homme, for choosing us to participate in this great event!

You can view the conference here: https://studio.sonoptik.ca/Blockchain/

Video presentation by DTI:

The post TRANSFORMING TAX SYSTEMS WITH BLOCKCHAIN appeared first on Dti.

In the EU and the USA, countries are still losing millions in tax revenue because they haven’t perfected their tax-collecting systems just yet. However, both of these unions are facing different problems. The USA is losing millions due to VAT (or the lack of it), and the EU is losing a significant amount of revenue with the Tax Recovery System.

What Is the Tax Recovery System?

Tax Recovery is a system that the members of the European Union use to properly track taxpayers who didn’t pay for their taxes and decided to move away. There have been a lot of cases of citizens escaping from one European country to another only to avoid paying for their taxes. Naturally, this harms the economy and the EU had to find a way to stop it.

Thanks to this system, one Member State can hold you liable for the taxes you avoided even if you live in another state. This can even go to the point where they can seize your salary or even automatically deduct a certain amount of your paycheck until you have paid your taxes in full.

Naturally, a taxpayer will always be notified in time about the taxes they didn’t pay. For this scenario, EU prepared the “Uniform Notification Form,” which the EU uses when a tax authority of the taxpayer’s state of birth demands that you pay for your taxes from a different state. The form provides all the documentation and proof that one has not abided by the law and must pay their taxes as soon as possible.

Naturally, you can obtain the form in your own native language; or any other recognized language of the EU.

In case a taxpayer still denies fulfilling their civic duties, the Member State can take recovery actions. They can do this by using the so-called “Uniform instrument permitting enforcement in the requested Member State.” This significant document allows for enforcement in the state where the tax is due. Either way, establishing proper communication between member states of the EU is crucial, because the number of people trying to avoid taxes by disappearing is constantly increasing.

What Can TaxCore Do?

The Tax Recovery system does its job, to an extent. It is, unfortunately, still quite bureaucratic. And in the 21^st century, any space for mistakes should be minimal – and lengthy paperwork should not be an issue anymore.

Because of bureaucracy, many countries worldwide are suffering from loss in tax revenue. This is where digitalization can help; it can make things run faster and more transparent.

TaxCore offers a solution where every taxpayer is registered into the system and each payment can be thoroughly tracked. The established server of the tax office constantly receives real-time feed from taxpayers and is aware if any of them are trying to dodge taxes or any VAT costs.

In the case of Tax Recovery system, this can only be useful and speed up the slow procedures. As a platform, TaxCore is very adaptable and formidable, which means a certain country can build up a whole system around it. The point of the platform is to help tax authorities motivate their taxpayers and punish accordingly those who avoid taxes.

Every taxpayer is registered with TaxCore, should this taxpayer own a business, it will have its own digital signature so the tax office can easily track their receipt issuing. If they notice receipts are not being issued for a certain period, they can quickly react. Our proof of audit technology will also stop a business from issuing receipts in case if it cannot verify all of them and notices a few are missing.

By using technology to our advantage, we managed to create a system where transparency leaves absolutely no space for maneuvering. For these reasons, both developing and developed economies can use TaxCore to their advantage and increase their tax revenue significantly.

The post EU’s Tax Recovery System and How TaxCore Can Help appeared first on Dti.

The reasons why a country may be suffering from low tax collection can be many, and they vary from nation to nation. Taking into consideration all the countries and all the different problems they’re facing, TaxCore brings a revolutionary change that can greatly help.

Auditing

With TaxCore, governments and tax authorities receive a platform that is 100% transparent and safe. It is a platform that allows them to monitor taxpayers and their businesses in real-time. For the most part, this does help tax authorities oversee if a certain business isn’t registering sales or isn’t issuing receipts regularly.  TaxCore digitally signs every fiscal receipt so it’s very easy to track them and their validity. But every so often, transparency and proper monitoring aren’t enough – so TaxCore’s DTI solution came up with a new solution to the problem, the proof of audit feature.

Proof of Audit serves as a confirmation from the tax authority system has stored all the invoices issued with a particular digital certificate in its database. The proof of audit, designed by DTI, is very flexible, and it doesn’t limit business in any way. It is issued after each fiscal invoice (remote audit) or after a group of delayed invoices reach the database (local audit). Delayed invoices may occur due to an unexpected loss of internet connection. TaxCore allows to save these invoices and to audit them once the internet connection comes back. Proof of audit also confirms that exactly the same data that was entered in the taxpayer’s SDC was transferred to the tax authority database.

Use of the mini-blockchain technology with the proof of audit

By using blockchain technology to link all fiscal invoices issued with a particular digital certificate, TaxCore, will instantly notice if there is a gap in the invoice submission sequence (e.g. if one or more invoices from that specific certificate chain are missing). Should this happen, the taxpayer will not receive their proof of audit. Instead, TaxCore’s DTI will wait for all the invoices to arrive at its database. Additionally, TaxCore issues all these invoices with this particular digital certificate. Only then will the database send a proof of audit to the taxpayer.

The system can delay the proof-of-audit too if so needed. However, there is a preset limit to this, and if not obeyed, the system will block the taxpayer from issuing any new fiscal invoices. The purpose of this setup is to motivate taxpayers to report regularly. Even if a taxpayer suffers a lack of internet connection which prevents normal invoice submission, the system will still inform them that the preset limit is approaching. In this case, a taxpayer can perform a local audit so that they could obtain a proof-of-audit.

The proof of audit function works in a way that it takes the new data and moves backward through the mini-blockchain (link by link). This confirms that TaxCore has accurately recorded all of the data contained in the SDC and its associated Secure Element. Therefore, nothing is missing, no data can be manipulated, and the whole system works perfectly on all ends.

A seamless process

The whole process is seamless, fully automated, and works continually (although this does depend on the taxpayer’s internet connection to an extent). All a taxpayer really needs to do (to know that they are fully tax-record-compliant) is to make sure that the on-premises-Sales Data Controller has a stable connection to the internet. Even if the connection stops for a short period of time, it won’t impact a taxpayer at all.

Thanks to this new proof of audit technology, TaxCore’s DTI ensures that tax fraud is nearly impossible as it motivates taxpayers to report regularly. Moreover, it helps tax authorities easier be in touch with taxpayers and their business practices. This helps build a transparent environment and significantly increases tax revenue, which helps for a country’s prosperous economy.

The post Proof of Audit – Created by DTI for TaxCore, 2nd Year in Production appeared first on Dti.