Annex 1: Results Framework to improve the effectiveness of operational functions of Montenegro’s Tax Administration Project Development Objective (PDO): and to reduce the compliance costs for corporate taxpayers Description Cumulative Target Values** Unit of Data Source/ for (indicator Baseline Measure Methodology Data definition Core 2018 2019 2020 2021 2022 Collection etc.) PDO LEVEL INDICATORS Improved Effectiveness of operational functions Tax Gap for Percent Annual Monstat data MTA Methodology VAT and MTA’s Planning and and baseline estimates based Analysis for tax gap to on taxpayer Department be developed Ratio survey and during the VAT to 12.3 12.3 12.3 12.5 12.8 13.4 methodology first year of consumption ratio developed in the project. is being used as (2010-14 the first year of proxy average) project ratio is implementation used as a proxy indicator. % of returns filed Percentage VAT: 82 82 82 86 90 92 Annual MTA data MTA Number of on time (2016) Collection returns and IT on time as Department percentage of CIT: 89 89 89 94 96 98 to the total (2016) number of returns for VAT and CIT Reduced compliance costs Time it takes to Hours 314 314 310 280 250 200 Annual Doing Business MTA Number of pay taxes and (2015) data PMU it takes social to comply contributions with tax and social security legislation
Annex 1: Results Framework Project Development Objective (PDO): to improve the effectiveness of operational functions of Montenegro’s Tax Administration and to reduce the compliance costs for corporate taxpayers Core Unit of Measure Baseline Cumulative Target Values** Data Source/ Methodology for Data Collection Description (indicator definition etc.) 2018 2019 2020 2021 2022 PDO LEVEL INDICATORS Improved Effectiveness of operational functions Tax Gap for VAT VAT to consumption ratio is being used as proxy Percent Ratio 12.3 (2010-14 average) 12.3 12.3 12.5 12.8 13.4 Annual Monstat data and MTA’s estimates based on taxpayer survey and methodology developed in the first year of project implementation MTA Planning and Analysis Department Methodology and baseline for tax gap to be developed during the first year of the project. ratio is used as a proxy indicator. % of returns filed on time Percentage VAT: 82 (2016) CIT: 89 (2016) 82 89 82 89 86 94 90 96 92 98 Annual MTA data MTA Collection and IT Department Number of returns on time as percentage of to the total number of returns for VAT and CIT Reduced compliance costs Time it takes to pay taxes and social contributions Hours 314 (2015) 314 310 280 250 200 Annual Doing Business data MTA PMU Number of it takes to comply with tax and social security legislation
Montenegro-Revenue-PAD-07122017.docx