On 3 March 2022, the Addis Tax Initiative (ATI) Secretariat and the OECD’s Forum of Tax Administrations (OECD FTA) organised a webinar on the Digital Transformation Maturity Model (Maturity Model) and its practical insights derived from the experiences applying the Maturity Model in Armenia. The event participants included members of the ATI as well as the Network of Tax Organisations (NTO). The dialogue was led by two presentations given by Mr. Rex Arendsen, Senior Advisor at the OECD FTA, and Mr. Sergey Paturyan, Advisor at the IT Department in the Armenian State Revenue Committee.
In the first presentation, Mr. Arendsen gave participants an overview of the Maturity Model, which is a self-assessment tool that that allows tax administrations to evaluate their level of digital maturity. The model represents one of the set of actions derived from the Tax Administration 3.0, the FTA’s vision for the digital transformation of tax administrations. Thus, the model’s report describes and visualises how tax administrations could potentially migrate from digital efforts towards a true transformation in the operational model. The Maturity Model consists of six main themes or key building blocks, whose scores allow tax administrations to be categorised into five discrete maturity levels: 1) emerging, 2) progressing, 3) established, 4) leading and 5) aspirational. The Maturity Model serves as ‘how-to-guide’ for tax administrations, as it provides senior leadership and staff with a good overview of the type of changes that could enable them to reach a higher level of digital maturity over the long run.
The Maturity Model has been performed by 47 tax administrations, including FTA and non-FTA members. As the anonymised joint results of this exercise has been presented in the model’s report, Mr. Arendsen highlighted the importance of other tax administrations, particularly from developing countries, to perform this model in order to compare their own maturity in the different aspects of digital transformation to that of their peers.
The second presentation by Mr. Paturyan focused on the Armenian experience of conducting this self-assessment exercise. The Maturity Model is valuable because tax administrations obtain a clear understanding about their digital maturity, and can detect problems that they originally would not have considered without the support of the descriptors/indicative attributes linked to the six key building blocks.
Armenia’s self-assessment was completed in a period of three weeks, with the participation of four staff members including a facilitator. Mr. Paturyan explained the distribution of the building blocks among the staff, and emphasised that for each block descriptors/indicative attributes should be well understood in order to prepare individual scores. In the Armenian case, every member had to provide individual scores for the attributes in her/his scope of blocks after two weeks. Simultaneously, each member gave estimations for the scores for all attributes in all building blocks. The Armenian tax administration subsequently discussed the scores and assigned a final score, either by consensus, majority or as a final decision of the facilitator. As a last step, they sent the completed self-assessment record sheets to the OECD FTA Secretariat.
The presentations were followed by a lively discussion and Q&A session that was moderated by Ms. Varsha Singh (ATAF). Details about the relevance of the self-assessment for tax administrations, particularly the role of digitalisation as an enabler of greater efficiency for these organisations since the start of the pandemic were discussed. Mr. Arendsen explained that the ultimate vision is for tax administrations to gradually become more embedded into taxpayer natural systems. The Maturity Model helps tax administrations and organisations inform their strategy design and implementation. In the short term, it helps explain one’s capabilities. By being able to assess the landscape of their IT environment, tax administrations can detect areas, in which they excel and/or lag, and act upon it.
Responding to questions on the possibility of conducting external assessments apart from the self-assessment, Mr. Arendsen highlighted that the self-assessment requires intrinsic motivation to improve quality: one depends on one’s own expertise. There is of course, the possibility of enhancing internal quality by inviting more experts. Nevertheless, the two speakers underlined the importance of creating ownership with both experts and management and enhancing capabilities. Mr. Arendsen’s final encouragement is for tax administrations to not let subjectivity get in the way of conducting their own assessment. Adding on to his point, Mr. Paturyan highlighted that an external assessor might not be able to completely comprehend a tax administration’s processes and structure in such a short period of time.
From the participant side, the main challenges connected to the digitalisation path of revenue administrations were raised, including (i) the need to develop a digital strategy that builds upon a network of government institutions, and (ii) the importance of change management for this type of organisational change. Responding to these concerns, Mr. Arendsen shared a report ─ recently produced by the OECD and ATAF ─ that assist developing country tax administrations in their digitalisation journeys through examples of good practice and key learning.
Based on the interest of ATI and NTO members, some consultation sessions will be organised for national tax administrations that decided to implement the Maturity Model. Participating countries will be able to exchange experiences, and receive guidance on the implementation of this self-assessment process by the OECD FTA Secretariat.
 These six key building blocks are: digital identity, taxpayer touchpoints, data management and standards, tax rule management and application, new skill sets, and governance frameworks.
 Administrations that wish to speak to other peers for knowledge sharing purposes could ask the OECD FTA Secretariat to reach out to that peer for agreement to put them in touch.
 For each of the six building blocks, a high-level descriptor of maturity is set out at the top of the building block section. In addition, to assist in the understanding of a given level of maturity, a set of indicative attributes (from two to three) is also contained in each of the six Maturity Model tables.
 The group of four members was composed of three permanent IT specialists and one representative of the methodology department. The facilitator was an IT specialist.