Türkiye is establishing an infrastructure that will enable it to transition all tax auditing processes to a fully electronic platform, a system that a senior official says will help the government ramp up the fight against the informal economy.
The new system will allow tax inspectors and taxpayers to meet electronically, with interviews and documentation being handled entirely in the digital space, said Treasury and Finance Minister Mehmet Şimşek.
Şimşek emphasized that the shift to digital platforms is a strategic move to strengthen the fight against the informal economy.
"With this new system, tax inspectors and taxpayers will be able to meet electronically, conduct interviews online and record all minutes electronically," Şimşek said. He added that the system would incorporate technologies such as electronic minutes, teleconference applications and machine learning, with significant progress expected within a year.
Şimşek also stressed that all technologies to be used in the new system would be sourced domestically, avoiding reliance on foreign cloud services or overseas teleconference platforms, which could pose confidentiality risks.
"By using domestic software and storing all data on ministry servers, we are avoiding issues related to tax privacy that could arise from the use of foreign cloud services," Şimşek told Anadolu Agency (AA).
Documents can currently be submitted to inspectors electronically, but in many cases, in-person meetings between inspectors and taxpayers remain necessary.
With the new system, all documentation traditionally handled on paper, including tax audit reports, will be transitioned to an electronic format, with e-signatures replacing handwritten signatures. That will create a fully digital audit unit, minimizing costs associated with paper, toner and printers.
No more travel for tax audits
Türkiye's Tax Audit Board (VDK) operates offices in nine major cities, where most of the audits are conducted.
Under the new system, video conferencing and electronic meetings will eliminate the need for taxpayers to physically attend these audit offices.
"Taxpayers will no longer have to travel to the audit units. For example, those residing abroad will not need to return to Türkiye solely for audit purposes, reducing both time and transaction costs for compliance," Şimşek said.
The system also allows tax inspectors to audit taxpayers across the country without the need for travel, focusing efforts on specific regions as needed.
That will reduce travel and accommodation costs while ensuring uninterrupted public services even in extraordinary circumstances. Meetings, training and conferences will also be conducted entirely online, lowering organizational expenses.
By enabling tax inspectors and taxpayers from different cities to meet electronically, the new system will mitigate the risks associated with localizing audits.
The system will also facilitate e-settlement, allowing settlements to be conducted electronically, and e-explanations, enabling taxpayers to provide explanations remotely within the scope of legal inquiries, Şimşek noted.
He also said the ministry further aims to enhance tax compliance and awareness through electronic and remote training programs, particularly for some industries, ultimately promoting voluntary compliance with tax laws.