Dr Małgorzata Sęk

adjunct

Tax Law Department

Centre of Tax Documentation and Studies

Faculty of Law and Administration - University of Lodz, Poland

Digitalization provides new opportunities for reducing tax fraud on the one hand, and tax compliance and administration burden on the other hand. However, the latter result can only be achieved in the long term perspective, as introduction of new reporting and auditing models is connected with significant investments for both tax administration and tax authorities during the implementation stage and soon afterwards. Digital reporting, either in the form of periodical reporting or in the form of real time reporting, provides tax administration with vast amounts of data, which is standardized, easily readable and transferable and can be analyzed with the use of sophisticated algorithms. The possession of the data, especially detailed transactional data, enables the cross-checking of what is being reported by the supplier and the customer. These data can further be confronted with data submitted by third parties with reporting duties, e.g. banks and other financial institutions, or data from financial statements of the taxpayer, etc. Tax audit can be focused on data analysis rather than on site auditing, which reduces costs for both tax administration and compliant taxpayers. Due to the use of advanced risk analysis based on sophisticated algorithms, tax audits become better targeted and more effective. Generally, the worldwide trend is a shift from paper to digital reporting and from periodical to real time reporting. The aim of the lecture is to present these developments, from the Polish perspective, with special focus on the Unified Control File for VAT (JednolityPlikKontrolny, JKP VAT), which is one of the components of the Polish equivalent of the Standard Audit File for Tax (SAF-T) created by the OECD.