Data Driven TaxActian Conference, London, Nov 1st 2018

➢ The Office of the Revenue Commissioners is the primary state body responsible for the assessment and collection of taxes and duties in the Republic of Ireland.

➢ Approx. 6100 staff collecting almost €51bn in 2017.

➢ Taxpayers and intermediaries e.g. accountants, tax practitioners, agents expect a joined-up Revenue operation for contacts, collection and audit

➢ Government requires and assumes Revenue can take on new taxes and duties readily.

➢ Data is our raw material and is at the heart of everything we do.

➢ ICT is a key enabler of the Revenue Business.

➢ Complex and heterogeneous ICT environment but Ingres DB still at the heart of our systems.

Setting some Context

To understand what we can do with data, you need to understand

where we’ve come from…

Our administration of tax and customs by reference to international benchmarks

is highly rated

Ease of Paying Taxes Ranking*

Burden of Customs Ranking**

2012 6th world (1st EU) n/a 2013 6th World (1st EU) 5th World (4th EU) 2014 6th World (1st EU) 8th World (3rd EU) 2015 6th World (1st EU) 6th World (2nd EU) 2016 5th World (1st EU) 6th World (2nd EU) 2017 4th World (1st EU) 6th World (2nd EU)

*World Bank / PwC, Paying Taxes reports.

**World Economic Forum, The Global Competitiveness Report.

How are we doing?

Registration

Returns

Collection

Assessment

InterventionManagement

MIS

Registration

Returns

Collection

Assessment

InterventionManagement

MIS

Registration

Returns

Collection

Assessment

InterventionManagement

MIS

Common Registration

Common Returns, Collection etc

Common Caseworking

Common Business Intelligence

From multiple disparate systems To a single integrated framework

Tax 1 Tax 2 ..Tax n

CRS

ITP

AIM

IBI

…then Internet enabled ROS

Tax 1 Tax 2 ..Tax n

Integrating our data

Core Database powered by Ingres

Integration driven services Developed from the mid 1990s onwards to provide;

• Single view of the customer,

• Significant automated processing,

• Strong support for both customer service and compliance activities,

• Access to both Revenue and 3rd party data,

• Significant Business Intelligence capability,

• Analytics to prevent, detect and confront fraud using some basic real-time models.

• Continues to evolve to this day – still using Actian Ingres & OpenROAD.

OpenROAD

JSP/Angular

▪ Extensive online 24x7x365 presence.

▪ Continued Major Focus on digital services.

▪ Internet based Revenue Online Services (ROS)and MyAccount provides secure, full self-service functionality for most taxes/duties for business, tax agents and individuals.

▪ Customs largely facilitated by B2B services.

▪ Backed by legislation – mandatory efiling.

▪ Prefilled tax returns based on data held by Revenue.

▪ Full visibility of Revenue tax record.

▪ Mobile aware and phone app available for Customers

Customer Facing services

Transactional Data to BI

Provide sophisticated BI to users from Transactional Data using ETL techniques including the use of HVR used to move data from Ingres to Vector.

Presentation layer uses a mix of suitable tooling.

This data lives in a separate Data Warehouse to ensure no impact on live systems.

This allows for all sorts of querying/reporting/matching/3rd

party data take-on/specific batch…..

Ingres

But things are changing

Business vision

(realtime interfaces for PAYE/VAT)

PAYE RTI

Shared economy (e.g. Airbnb, Uber)

Contingent workforce growth

Emerging trends (e.g. Internet of things, Bitcoin)

Technology advancements (e.g. machine learning, natural language processing, touch commerce)

Technology obsolescence

Significant information from other jurisdictions

International Tax, Trade wars….

What’s next?Natural Taxation

TraditionalTaxation Burden

• Self Assessed• Taxpayer Registration• Information Search• Additional Business Process

Convenience

• Revenue Reporting• Automatic Inclusion• Information Prompt• Embedded Business Process

• Complex Tax Legislation • More ComplexTax LegislationCertainty

• Period Based Reporting• Deferred Accuracy

• Transaction Level Reporting• Real-Time

“Natural Taxation”

Insight Driven Processing

Further evolve IT to support a fundamental shift in tax policy.

Strengthen the partnership between business and IT.

Support a different way of working for both our external and internal customers in today’s digital world.

Use technology and data to drive efficiency through;

• More real-time and natural taxation• Better audit selection, • Automated returns, • Improved real-time risk monitoring,• Prompted reminders/warnings,• Increased internal measurement and BI capability,• Better risk analysis,• And more……..

Real-time PAYE

Seamless integration of reporting into the payroll process

Employees to be paidGet latest Revenue Payroll Instructions

Perform Calculations Finalise

Bank File / Cheque

Payslips

Revenue Report

Money in Bank / Hand

Payslips

Pay and Deduction in

PS

• Largest change to PAYE tax system introduction in 1960s• Major engagement with employers and payroll software industry• Will streamline and simplify PAYE process• Expected “bounce” in yield• Will provide huge data stream – further insight• Go-live 1st Jan 2019

Transactional Application

Hazelcast

IngresHbase / Hadoop

HadoopVector

Business Intelligence Application

PAYE Hybrid Data stack• Large volume of Returns – initially stored in-memory (Hazelcast)• Written out to Hadoop as JSON objects• Specific tax return data parsed into traditional RDBMS tables• BI run against Hadoop with some processing in Vector for performance

Bringing order to chaos

The production of BI statistics and metrics based on data is not for the unskilled or casual user. Democratisation of BI needs controls ideally via extensive filter-capable dashboards.

For investigative analytics and BI, formal statistics and hypothesis testing consider developing Centres of Excellence with a “hub and spoke” arrangement.

High Level SNA Architecture

SNAReports

Visualisation

ETL

Network

creation

Data:Flattened,cleansed,

standardised,entity-resolved

Graph Database

CRS

CRO

Data

Warehouse

SNA, powered by

ITPCIF

CIF VIEScapdtiVW

SNACommonality

tool

Social Network Analysis (SNA)• Another way of analysing data• Requires good IT and good business

analysts to interpret the networks correctly• Ideal for targeting fraud

Allows disparate data to be linked based on things like;address, email, phone numbers, bank accounts,Directorships, etc.

Gives some very interesting insights!

Interrogation of data using Social Network Analysis (SNA)

Analytics Warehouse Stack

PAYE/VAT ABT ETL’s

ETL Server

SAS Server

Tax Modeller SAS Frontend

SAS

Datastore

Warehouse Servers

Cloudera Navigator

Hadoop Cluster

Working BusinessData

Marts

Hadoop ETL’s

Control

R Server

R Studio R Shiny Reports

Cloudera Hue

Hadoop Adaptive

Load (HAL)

Staging Integration

Bulk Nav

Metadata

Sourc

e

Data

Quality

Rules Engine

Eskort RISK

Rules Engine

Transactional DBs (Ingres)

ITP

VIES AIM

IIM COpenL

ECUS REAP ICRTR

CRSCIF

Vector

1-way data flowDatabase

Internal Application

GUI/User Application

2-way data flow

• Completely dedicated Analytics warehouse, separate to BI environment.

• Allows for experimentation, etc.• Holds ABTs for Data Scientists.

Best of breed tech…..

In summary

• Lots done, but had a good base in place

• Focus on what data you already have and join it up

• Matching data is hard

• Business and IT are one in the same – work collaboratively

• As ever, beware of silver-bullets!

• Pilot things, use open source tools

• Staff training and change management are essential

• The journey never stops, you have to keep running

• Enjoy – this is interesting, worthwhile and fun

Thank you for your attention

John Barron

jbarron@revenue.ie