JUNE 28, 2016

By Neeraj Prasad

IN these uncertain times, the whole country is eagerly awaiting the roll out of GST which indeed would be a huge leap of faith and expectation from the present noodle bowl tangle of indirect tax administration. However, within the folds of CBEC there is a sense of disquiet and foreboding about what the future portends. GST has the promise to be a game changer for the country and there is no doubt about that. What will be the eventual role of the department will eventually be determined by the powers that be. One thing is certain, the GST proposed in the 122 nd Constitutional Amendment Bill envisages a win-win situation for both centre and the state. But is this reassurance enough to prepare for the momentous change - Certainly no!! There is an urgency like never before to reinvent CBEC.

The faceless majority of officials have to live with the daily ignominy of being considered capable of not much until and unless micro-managed and still worse being branded as corrupt. This scenario makes the typical functionary a very fearful and thoroughly de-motivated person. These officials, who would like to quietly and resolutely go about discharging their official responsibility, would quite easily identify themselves with the character of Vernon in the book Vernon God Little (2003) by DBC Pierre: Vernon is considered responsible by default for the killings carried out by his friend Jesus Navarro who later commits suicide. Fearing death penalty, Vernon goes on the run to Mexico. The Mexico of this majority of officials is a state of inaction or functional paralysis, an outcome more as a result of deficient institutions, which does not allow an enabling environment to contribute. There has to be a concerted attempt to address this problem.

OECD in its annual tax administration surveys, points out the questions which are relevant from the point of view of having an effective Human Resource Management strategy which are as follows: Does the tax administration periodically survey staff on their attitudes, perceptions and workplace satisfaction?, Does it assess staff engagement and motivation?, Are the results of any such surveys and assessments shared with staff?, Are staff consulted in developing and implementing actions plans in response to such survey and assessment findings?

Organisational Climate Survey (OCS) which also stands recommended by TARC report (vol. 1), has been adopted by tax administration of many developed economies to address the human resources issues raised by OECD. “Organizational Climate” is defined as people's perceptions of the environment in which they work. The concept of Organisational Climate Survey was first propounded by George H. Lotwin and Robert A. Strainger Jr., in their seminal work: Motivation & Organisational Climate (Harvard Business School Press, 1968).

Singapore Inland Revenue Authority (IRAS) conducts such an exercise. The biennial Organisational Climate Survey (OCS) is one of the key channels for staff to provide feedback on IRAS development and initiatives, and helps in identifying the areas of improvement which would make working in IRAS more rewarding and meaningful for staff. The Internal Revenue Service of USA also comes with periodic efforts such as the Report titled: IRS Workforce of Tomorrow .The focus of this report is aimed to create a culture in which every employee is valued and empowered to contribute to his/her own success and the success of the organisation. Having a periodic OCS framework in place should be an urgent imperative for the CBEC.

Simultaneously, CBEC also needs to undertake a thorough diagnostic of its tax and customs function, a process owned and monitored by it . The framework which can be used for this purpose is Tax Administration Diagnostic Assessment Tool (TADAT) developed by IMF. It is an integrated monitoring framework that measures performance of a country's tax administration at a point in time. It is designed to provide objective and consistent assessments of the outcome performance across the essential tax administration functions. The tool addresses questions of “what” and “why” with respect to performance. TADAT assessment provides country authorities with a better understanding of the health of the system of tax administration, the extent of reform required, the relative priorities for attention, and the basis on which to develop plans for future reform initiatives. Similarly for customs, the framework developed by the World Customs Organization (WCO) for customs reform and modernization should be used to meet internal goals and international commitments made under the Trade facilitation agreement (WTO). This Customs reform should also focus on creation of capabilities and institutions. Very recently, Minister of Commerce (GOI) talked about creation of an organization on the lines of International Trade Commission (USA), CBEC can also have similar such institutions, integrating and enhancing its capacity across the entire gamut of International trade policy making and administration.

The eventual purpose of all this exercise should be to come up with a strategic action plan of the CBEC. This Strategic plan would be the CBEC guide for deployment of resources and provide focus on key activities and measurements of achievement in attaining the vision or future state of the organization. A strategic plan is a tool that helps management do a better job, as it assists in establishing the key linkage between core values, the principles of tax policy, and the tax administration, by anticipating challenges, developing appropriate responses, and effectively utilizing strengths to achieve improvements. The strategic plan helps to focus the entire tax administration's resources and efforts and guides all parts of the tax administration towards the same goals. The end product of the strategic planning process is a collaborative set of decisions on the objectives or goals about what to do, a justification for why do it, and, through a series of actions and projects, an approach on how to do it.

To undertake all of this gargantuan effort, CBEC certainly would have to take the assistance of outside agencies/experts. Keeping in view the planned roll out of GST from 1 st April 2017, it would be great if the strategic action plan of CBEC is issued before that, being available to all its officers & would go a long way in giving them a sense of assurance and renewed purpose.

(The author is Additional Commissioner, Delhi Customs (Preventive) and the views expressed are strictly personal.)