Information and intelligence capabilities are an important aspect of modernising the tax administration.Â The future tax administration will involve:
- greater use of pre-populated tax returns;
- more automated and streamlined information flows; and
- a broader approach to compliance based on smarter use of information and a wider range of interventions.
The Government considers that Inland Revenueâ€™s information collection powers work well.Â They are generally consistent with those of revenue agencies in other countries.Â Â However, the ways in which information is stored have changed.Â More information is stored in the â€ścloudâ€ť and large electronic datasets have become more commonplace.Â Therefore the Government is reviewing whether any updates are needed to ensure Inland Revenueâ€™s information collection powers remain fit for purpose.
Tax returns are a key source of information for Inland Revenue.Â The Inland Revenue Acts contain a range of information reporting and return requirements.Â Outside of the tax return process, Inland Revenue can require a person to provide any information considered â€śnecessary or relevantâ€ť to Inland Revenueâ€™s functions.
The Government considers that, in updating Inland Revenueâ€™s information collection powers, a â€śnecessary or relevantâ€ť standard should be retained.Â Retaining this standard gives the public continued confidence that Inland Revenue will not use its powers to obtain information that is not needed. Â Â Â Â