Focus on how organisational behaviour supports trust
A Tax Administration’s internal culture must support the development of a trust relationship between them and taxpayers. Such an approach towards taxpayers can sometimes face resistance within the organisation. But the trust based approach starts with the Tax Administration’s employees and therefore it is essential to understand and address trust from an internal perspective as well as an external one. This guideline looks at the behaviour and internal culture in Tax Administrations. Tax Administrations can be quite different from each other with different organisational structures and different organisational cultures depending on the social, ethnic, political and economic environments. Internal culture can be affected by a range of different things, such as job role, department, management style, meritocracy, culture, span of control (number of individuals who report to a manager), chain of command (line of authority) etc.8.1 Every employee is important when forming the internal culture
Employees are the frontline of the Tax Administration and act as ambassadors when dealing with customers and stakeholders. Every interaction between an employee and a taxpayer is an opportunity to build trust. The behaviour of tax officials towards taxpayers is linked to procedural justice. Many Tax Administrations have a code of conduct that sets out the standard of service and the behaviours that can be expected from their employees and this is to ensure that taxpayers are treated respectfully.
Tax Administrations should also consider how staff behaviour that builds trust can be rewarded. Performance measures could include indicators linked to trust, such as 360° feedback, the degree to what an employee demonstrates/internalises the core values of the Tax Administration etc.
In order to display similar values to taxpayers, employees must be respected and valued. In this regard a culture characterised by equal treatment within the organisation, between different genders, origins and age is essential.
Internal communication should be in line with the trust-based communication strategy that is defined at the top of the Tax Administration. What is seen as a success will be a strong signal to the employees. This is an important tool in building a trust-based culture.
Internal communication is often considered to be just one way, with messages coming from the top management to the employees. Internal communication must be two-way as this will get people engaged and will help build the organisation’s culture.
How do staff talk about tax payers within the organisation? In a respectful way or not? Tax Administrations should consider how employees talk about taxpayers. It is important to separate the taxpayer as an individual from the taxpayer’s actions. A taxpayer with compliance issues is not the same as a person who intentionally sets out to cheat on his or her taxes. Employees should not label taxpayers as a “bad guy” or a “big fish” as this may impact on the internal attitude and behaviour towards the taxpayers.
When it comes to how organisational behaviour supports trust leadership is crucial. This is well described and discussed in many academic studies. The treatment of taxpayers is influenced by the leadership displayed in a Tax Administration. Tax Administrations should highlight and reward employees who carry out their work in a manner that strengthens trust. Top management must also demonstrate the requisite values supporting trust and respectful treatment, if they want their employees to do the same.
Changes in organisational behaviour should be monitored to ensure it is going in the right direction. Tax Administrations must select the appropriate key indicators that can evaluate the changes. Employee surveys and questionnaires provide insights on attitudes and opinions on motivation, teamwork and the work environment. It would be useful to understand what motivates and engages employees and what internal improvements would be beneficial.