Preface v Chapter 1: The Netherlands 1 1.1. The country 1 1.2. Religion 2 1.3. Multiculturalism 3 1.4. The Dutch language 3 1.5. History from prehistory to the Republic 4 1.6. Golden Age 4 1.7. The Kingdom of the Netherlands 5 1.8. Society 6 1.9. Economy 7 1.10. The economic culture of the Netherlands 8 1.11. Digitalization of Dutch society 9 Chapter 2: The Dutch Tax and Customs Administration the Belastingdienst 11 2.1. Execution of legislation 11 2.2. Core tasks 14 2.3. Permanent task definition 14 2.4. Basic values 15 2.5. Business philosophy 16 2.6. Strategic objectives, vision and mission 17 Chapter 3: Scope of Social Impact 19 3.1. Scope of social impact 19 3.2. Principal: the Minister of Finance 20 3.3. Government Audit Office 21 3.4. National Ombudsman 21 3.5. Taxpayers 22 3.6. European Union 24 3.7. Relations with other government bodies 24 3.8. Standardization by the business community and the government 25 3.9. Societal responsibility 26 3.10. Tax and customs authorities of other countries 26 3.11. International tax administration organizations 26 ix
Chapter 4: Management of Integrity 29 4.1. History 29 4.2. Changes in society: dismantling the borders 29 4.3. Integrity on the political agenda 30 4.4. Concern for integrity: here to stay 30 4.5. Changes in moral standards and values 31 4.6. New questions on the agenda 31 4.7. Democratizing moral authority 32 4.8. Dotting the i s 32 4.9. The importance of integrity: four-pronged approach 33 4.10. The basic values 35 4.11. The purpose of basic values 37 4.12. Basic values in practice 37 4.13. ARDI 38 4.14. Training 39 4.15. Integrity counsellors 39 4.16. Communication 40 4.17. Monitoring 40 4.18. Evaluation framework 40 4.19. Evaluation by colleagues 41 4.20. Evaluation by managers 41 4.21. Standards for integrity 41 4.22. Criterion for appointing staff 42 4.23. Criterion for integrity counsellor 42 4.24. Three evaluation methods 43 4.25. Reporting and registering incidents 44 4.26. The Boomerang 45 4.27. Conclusion 46 4.28. Integrity investigations 48 Chapter 5: Trends in External Factors 51 5.1. Changing society 51 5.2. Globalization 52 5.3. The technological evolution 53 5.4. Environment, global warming and pollution 54 5.5. Organizational trends 55 5.6. Decentralization trends 56 5.7. Harmonization of tax issues 56 5.8. Merging processes 57 5.9. Simplification of taxes 58 x
5.10. Individualization and the further need to improve compliance 59 5.11. Governance and integrity 60 5.12. Increasing need for professional staff 60 5.13. Multicultural society 60 5.14. Demographic trends 61 5.15. Increased academic research on taxpayers compliance behaviour 62 5.16. Increased need to raise revenue 65 Chapter 6: The Process of Tax Policymaking and Legislation 67 6.1. Tax policy and legislation 67 6.2. The role of the Dutch Tax and Customs Administration 69 6.3. POWER 71 6.4. Compliance costs and administrative costs 71 6.5. Reducing the regulatory burden 72 6.6. Rationalizing the administration of social security contributions 73 6.7. Registration of new businesses with the Chamber of Commerce 74 6.8. Standard Business Reporting the Dutch XBRL Taxonomy Project 74 6.9. The Government Gateway 76 6.10. Connection between administrative expenses for citizens and business (compliance costs) and administrative costs of tax administrations 77 Chapter 7: Taxes in the Netherlands 79 7.1. Overview of taxes 79 7.1.1. National taxes 79 7.1.2. Local taxes 79 7.2. Personal income tax 80 7.3. Payroll tax and social security contributions 80 7.4. Corporate income tax 81 7.5. Dividend withholding tax 81 7.6. Inheritance tax, gift tax and transfer tax 82 7.6.1. Inheritance tax 82 7.6.2. Gift tax 83 7.6.3. Facilities on the inheritance of business assets 83 xi
7.6.4. Paying with works of art and objects of cultural and historical importance 83 7.7. Tax on games of chance 84 7.8. Value added tax 84 7.9. Excise duty and consumption taxes 85 7.10. Taxes on legal transactions 86 7.10.1. Transfer tax 86 7.10.2. Insurance tax 86 7.11. Tax on passenger cars and motorcycles 86 7.12. Motor vehicle tax 88 7.12.1. Tax on heavy goods vehicles 88 7.13. Environmental taxes 89 7.14. Import duty 90 7.15. International aspects of taxation in the Netherlands 91 7.15.1 General 91 7.15.2. Avoiding double taxation for resident taxpayers 91 7.15.3. Relief of taxation at source under tax treaties 95 7.15.4. Taxation of non-resident taxpayers 95 7.16. Customs 96 7.16.1. Import duties and taxes, and the role of the Dutch Customs Administration 96 7.16.2. Customs procedures in the Netherlands 97 Chapter 8: Business Philosophy 99 8.1. Business philosophy 99 8.2. Target group orientation and integrated case management 99 8.3. Careful action 100 8.4. Service provision 100 8.5. Compliance management 101 8.6. Critical success factors 103 8.7. Performance management 106 Chapter 9: Compliance Strategy 113 9.1. DTCA compliance strategy 113 9.2. Enforcement of the law 113 9.3. Law application 114 9.4. Client treatment strategies 115 9.5. Service provision 116 9.6. Supervision 117 xii
9.7. Audit 118 9.8. Audit policy 119 9.9. Horizontal monitoring 124 9.10. Self-regulation 125 9.11. Tax control framework 126 9.12. Cooperation with tax intermediaries 126 9.13. Supervision that makes a difference 127 9.14. Intervention teams 127 9.15. International exchange of information 127 9.16. Voluntary disclosure scheme for offshore accounts 128 9.17. From supervision to fraud detection 128 9.18. Fiscal investigation 129 9.19. Monitoring compliance 130 9.20. Measuring compliance 131 9.21. Effective tax debt collection 132 9.22. Visible supervision 135 9.23. Enforcement publicity 135 9.24. Examples of national actions 135 9.25. Collaboration 136 9.26. SoFi number 137 Chapter 10: Base Registrations 139 10.1. Introduction 139 10.2. The Streamlining Basic Data programme 139 10.3. Background to Streamlining Basic Data programme 140 10.4. The policy behind the Streamlining Basic Data programme 141 10.5. Positioning the DTCA 143 Chapter 11: Management Philosophy 145 11.1. Why a management philosophy? 145 11.2. Origin 145 11.3. Guiding principle 145 11.4. Frameworks 146 11.5. Making management policy explicit 147 11.6. National Tax District Office 148 11.7. Planning and control cycle 149 11.7.1. Business plan 149 11.7.2. Policy plans 149 11.7.3. Management contracts 149 xiii
11.7.4. Justification documents 150 11.8. Recent developments in management philosophy 151 11.9. Fiscal or Tax Monitor 153 11.9.1. Goals and design 153 11.9.2. Positioning 153 11.9.3. Themes 154 11.9.4. Client groups 155 11.9.5. Types of questions and method 155 11.9.6. Enhancing response 156 11.9.7. Recommendations 156 11.9.8. Main results 157 Chapter 12: Organizational Development of the DTCA: From Reorganization to Continuous Change 161 12.1. Reason for reorganization in the 1990s 161 12.2. Change of course 161 12.3. Policy changes 162 12.4. Old structure: means and process-oriented 163 12.5. New structure: target group-oriented and integrated 163 12.6. Restructuring of the business process 164 12.6.1. Logistic management 164 12.6.2. Data structuring 165 12.6.3. Specific treatment process/income Tax System (IBS) 165 12.7. Further developments 166 12.7.1. The next DTCA 167 12.7.2. Focus on processes 168 12.7.3. Standardization 168 12.7.4. The prospect of self-regulating teams 168 12.7.5. Management teams 169 12.7.6. Team as home base 170 12.7.7. A new organizational structure 171 12.7.8. Management teams 172 12.7.9. Management of the DTCA at the concern level 173 12.7.10. Hierarchy versus self-steering 173 12.7.11 Self-steering requirements 174 12.8. The need for stronger steering and coordination 176 12.9. Tax Districts and the National Office for Tax Districts 176 xiv
Chapter 13: Processes 179 13.1. Main processes 179 13.2. Main processes: identification and registration of taxpayers 179 13.3. The Tax Identification Number 181 13.4. Main process: levying 182 13.5. Pre-populated (or pre-completed) tax returns 184 13.6. Main process: supervision 184 13.7. Auditing 185 13.8. EDP auditing 186 13.9. Main process: supervision of the execution of non-tax legislation (customs) 188 13.10. Main process: fraud detection 188 13.11. Main process: collection 189 13.12. Appeal procedures 191 13.13. Mediation 194 13.14. Main process: service provision 195 13.15. Lifecycle of an enterprise and risk assessment 200 13.16. Supporting processes 202 13.16.1. Personnel and organization 202 13.16.2. Finance 202 13.16.3. Accommodation 203 13.16.4. Information and automation 203 13.16.5. Research and development 203 13.17. Information and automation policy 204 13.17.1. DTCA: an information-intensive organization 204 13.17.2. Social developments 204 13.17.3. Technological developments 206 Chapter 14: DTCA Typology 209 14.1. DTCA typology 209 14.2. Typology on the basis of legislation 209 14.3. Typology on the basis of the DTCA products 211 14.4. Typology on the basis of the characteristics of the taxpayer 212 14.5. Typology on the basis of the processes 213 14.6. Typology on the basis of a tax event 218 xv
Chapter 15: Ministry of Finance 219 15.1. Main processes 219 15.2. Mission statement of the Ministry of Finance 220 15.3. Secretary-General 221 15.4. Treasury 221 15.5. Directorate-General for the Budget 222 15.6. Directorate-General for Tax and Customs Policy and Legislation 222 15.7. Directorate-General for the Tax and Customs Administration 222 Chapter 16: A More Detailed Description of the Directorate-General for the DTCA 223 16.1. Introduction 223 16.2. Cluster Strategy and Implementation 223 16.3. Cluster Financial Management and HRM 224 16.4. Cluster law execution 225 16.5. Cluster Information Provision Policy 225 16.6. Internal audit of the DTCA 225 16.7. National Tax District Office 226 Chapter 17: Taxline Service 227 Chapter 18: Benefits 231 18.1. Introduction 231 18.2. Type of benefits 231 18.3. Childcare benefits 231 18.4. Rent benefits 232 18.5. Health care benefits 232 18.6. Process of payment of benefits 232 Chapter 19: Customs 235 19.1. Introduction and task of the customs offices 235 19.2. Competence of the customs offices 236 19.3. Customs districts and offices 236 19.3.1. Task of the customs offices 236 19.4. Customs Information Centre (DIC) 237 19.5. Customs change process 238 19.6. ecustoms and AEO status 238 xvi
Chapter 20: The Organizational Structure of the DTCA 241 20.1. Introduction 241 20.2. Tax districts and customs regions 244 20.3. Tax Districts and the National Office for Tax Districts 245 20.4. Economies of scale 245 20.5. Customs 246 20.6. Other operational offices responsible for primary processes 247 20.7. Facility centres 247 Chapter 21: Fiscal Information and Investigation Service (FIOD) 249 21.1. General 249 21.2. Organization 249 21.3. Investigation 251 21.3.1. FIOD investigation 251 21.3.2. ECD investigation and inspection 252 21.3.3. The ECD; clients 252 21.3.4. Cooperation with the public prosecutor s office 253 21.4. Information 253 21.5. Relevant context of the FIOD and the ECD 254 21.5.1. National cooperation 254 21.5.2. International cooperation 254 Chapter 22: Centre for Professional Development and Communication 257 Chapter 23: B/CICT Centre for ICT 261 23.1. Operational sector 261 23.2. Focus areas 261 23.3. Recent organizational change 262 Chapter 24: Facilitation of Service Provision Centre (CFD) 263 Chapter 25: Personnel Policy 265 25.1. Introduction 265 25.2. Personnel information 265 xvii
25.3. Personnel policy planning 270 25.4. Personnel policy 270 25.5. Terms of employment 272 25.6. Mobility 273 25.7. Management development 273 25.8. Technical development 274 25.9. Appraisal 274 25.10. Job evaluation 274 25.11. Personnel monitor 275 25.12. Flexible employment conditions 277 25.13. I Love Tax 278 Appendix: DTCA Indicators 279 xviii