Analytical report on the results of the internal analysis of corruption risks within the activities of the State Revenue Department in Astana
In accordance with the provisions of the Constitution of the Republic of Kazakhstan and the Law on Combating Corruptionas well as the Standard Rules for Internal Analysis of Corruption Risks approved by the Order of the Chairman of the Civil Service and Anti-Corruption Agency of the Republic dated January 13th, 2023 and Methodological Recommendations for conducting internal analysis of corruption risks issued on December 30th, 2022, Order No. 488/01and in accordance with Order No. 129/1 on April 25th, 2023 on conducting internal analysis of corruption risks within the Department of State Revenue, an internal analysis of corruption risk within the State Revenue department in Astana has been conducted.
An internal analysis of corruption risks has been carried out by a working group, as defined by Order No. 129/1 dated April 25, 2023. The working group consisted of employees with practical experience in applying industry legislation in their work, including the deputy head and heads of departments and customs posts within the organization
Information from information systems and other relevant sources was analyzed to identify potential corruption risks and develop recommendations. The analysis was conducted in accordance with approved methodological guidelines, which included the following steps:
1. Collection and compilation of information about the organization under review.
2. Analysis of relevant legal acts and internal policies governing the organization's operations and management processes to identify potential areas where corruption risks may arise.
3. Preparation and submission of a comprehensive report summarizing the findings and recommendations.
During the course of the investigation, the following have been analyzed:
Legal acts and internal documents governing the activities of the department;
Provision of public services;
Appeals from individuals and legal entities related to the subject under review;
Development and allocation of budgetary and financial resources for 2022 and the previous period of 2023;
Information systems;
Establishment of facts regarding hiring of individuals who have previously engaged in corrupt activities;
Identification of individuals engaged in activities that are incompatible with the discharge of government functions;
Establishment of joint employment (service) by close relatives, spouses and relatives;
Exercise of official duties while in a conflictof-interest situation;
Sending of civil servants for anti-corruption training.
Considering the diversity of functions and intersectoral nature of the department's work, the analysis covered 3 main areas, including:
1. implementation of control and audit functions;
2. provision of public services;
3. analysis of regulatory legal acts affecting the operations of the OGD
Based on the results of the analysis, 4 areas of corruption risk were identified.
Area of activity covered
1. **Implementation of control and audit functions**
- Risk name: Implementation of organization of work on tax administration in terms of tax audits
- Description: Potential for corruption in the organization and implementation of tax audit processes, leading to potential for unfair advantage for certain parties.
The establishment of violations of the current tax legislation and related additional charges for taxes, fees and other mandatory payments is a concern. Corruption can occur as a result of direct contact between taxpayers and employees when submitting requirements, orders for an audit, or notifications of the suspension or resumption of a tax audit in terms of compliance with deadlines established by law.
To mitigate this risk, it is recommended that:
- Taxpayers should ensure that all documents and information submitted are accurate and complete.
- Employees should be trained to adhere to the relevant tax laws and regulations.
- Regular audits should be conducted to ensure compliance with tax obligations.
In the absence of the ability to issue an order for an audit to a taxpayer, or to provide them with a requirement for documents, notice of suspension or resumption of a tax audit process, it is essential to automate the transfer process through the taxpayers' office in accordance with Article 146 of the Tax and Other Obligatory Payments to the Budget Code, as well as to amend Article 149 of the same Code regarding the transfer of verification orders through a web application.
2 The name of the corruption risk
Unlawful withdrawal of RPOs at a specialist level for unfulfilled notices on elimination of violations identified by tax authorities based on desk control results.
According to the established RPO in the IS of the ECD of the Russian Federation, in view of the non-compliance with the notification on elimination of violations identified by tax authorities based on the results of desk reviewall employees currently have the ability to revoke the RPO through the IS INIS (managing orders for suspension of expenditure transactions on bank accounts).
Recommendations for mitigating the risk:
To eliminate corruption risks, it is proposed to establish approval regulations according to which recall of the RPO in INIS will take place at least at the deputy UGD level
2. Public service provision
1) Name of corruption risk: Carrying out refunds for excessively (erroneously) paid amounts arising from collections from debtors.
Description of the corruption risk:
According to the taxpayer's tax return, during the appeal period against the audit resultsany excess (erroneous) payments resulting from collected amounts from the debtor will be refunded.
Recommendations to mitigate risk
A refusal to refund any excess (mistaken) payments if there is a dispute regarding notifications based on audit results
3. Review of relevant regulations affecting the OGD's operations
1The name of the potential corruption risk
The risk of non-enforcement of administrative measures against foreign economic activity participants for violations of customs legislation under Articles 551, 553, and 535 of the Law of the Republic of Kazakhstan "On Administrative Violations" dated July 5, 2014, as well as discretionary powers granted to officials in deciding whether to impose administrative liability under Articles 288 and 558 of the Kazakhstan Administrative Code
Description of corruption risk:
In the event of non-compliance with the requirements for notification of audit results, the inspected party may be held administratively responsible under Articles 288 and 558 of the Administrative Code of the Republic of Kazakhstan, as established by notification of audit findings in accordance with Appendix 16 of the order.
If a participant in foreign trade violates customs legislationArticles 535, 551, 553, and other provisions of the Administrative Code provide for administrative liability in case of failure to submit documents during the inspection period. If the participant does not fulfill the requirements for submission of documents during the inspection, they may be subject to administrative liability under Articles 558 and 288
In the case under review, the provisions of the order conflict with the Administrative Code of the Republic of Kazakhstan and create corruption risks as well as the possibility for inspectors to arbitrarily decide whether or not to bring a person to administrative responsibility in accordance with Articles 558 and 288 of the Code in case of non-compliance with the notification requirements.
We consider it essential to remove Articles 558 and 288 from the Administrative Code in the context of notifications regarding the results of audits, in accordance with Appendix 16 to the order. This would allow for a full and fair application of administrative penalties against participants in foreign economic activities