Jurgita Domeikienė, Team Leader of EU4PFM, International Key Expert on HR / PAR, welcomed the event.

Rastislav Vrbensky, EU4PFM International Expert on strategic planning, reminded the participants about the components of the classical theory of strategic planning and cycles; mission, values, vision; goals, and objectives; risk assessment and management; setting priorities and allocating resources; measuring efficiency, business planning, and execution; system of indicators.

Egidijus Karmonas, EU4PFM International Expert on strategic planning, spoke about Lithuanian National Model for Strategic Planning until 2025 and the operational management of the strategy implementation process. He paid special attention to the role of the State Tax Inspectorate in the strategic plan of the Ministry of Finance, types of planning documents, deadlines for revision and strategic goals and measuring effectiveness at the organizational and individual levels, management and reporting, use of strategic planning and KPI in the Ministry of Finance, tax, and customs management.

According to Egidijus Karmonas, all these global changes in Lithuania have led to a number of positive results, such as a significant reduction in the budget burden due to a reduction of involved employees. “For example, the cost of collecting 100 euros of taxes over the last 6 years has decreased to 6 Eurocents,” said Egidijus Karmonas.

What then is the strategic management in the tax sphere of the country?

According to Egidijus Karmonas, this year Lithuania has introduced a new modern system of tax administration – VMI Polaris, which should be implemented in accordance with seven global goals: customer focus, flexibility, simplicity, relevance, the reality of time, development of collective intellectual potential and digital transformation.

For example, a criterion such as a Customer Focus should improve the management of the customer experience, taking into account their needs and increasing customer satisfaction.

“Simplicity” aims to reduce the amount of activity that does not create additional value due to the ratio of expenditures for financing the State Tax Inspectorate and taxes, payments collected jointly to the state budget and the local governments budget (as well as funds): by 2025 – 0.66%.

This year, Lithuania has worked on such tasks for achieving this goal as simplification of processes and procedures, robotization of processes, measures to identify foreign citizens and connect them to the State Tax Inspectorate (STI) information system, reducing the number of payment codes and more. Next year, Lithuania plans to implement the project “Administration of fines, economic sanctions, and other amounts levied for the state, including by courts.” By 2024, it is planned to merge the Tax service into one legal entity, etc.

An indicator of the effectiveness of such a criterion as “Compliance”, which aims to reduce the tax gap, is the implementation of the plan for basic tax revenues from 91.25 (2020) to 100% in 2025, to reduce the tax gap from 25.9% (2018) ) to 15% in 2025, reduce the level of justification for tax evasion according to the survey to 13.5% in 2025, halve – to 3.5% the ratio of unpaid and declared amount of VAT.

In addition, one of the goals of change is the development of collective intelligence in the STI. After all, without a quality change in the knowledge and skills of staff, it would be quite difficult to implement all these goals, convinced Egidijus Karmonas.

The plan for 2021 is to create a program for these purposes to manage human resources not only to attract new employees but also to plan activities to strengthen staff competencies, create a modern system for sharing all important information, as well as a platform for accumulation and exchange of experience.

Next year, it is planned to introduce a short-term internship program to expand the competencies of employees.

Another important goal is to create conditions encouraging employees to share ideas for improving work, including experience gained during international events, business trips, and more. Among the criteria for the effectiveness of measures to double the rate of employee involvement – up to 60% and at least 18 academic hours per year – is the time to improve the skills of one employee.

Thus, in the STI program, each strategic goal has a clear list of objectives and evaluation criteria.

A clear management system has also been introduced – through the Risk and Quality Management Committee, which makes it possible to assess the quality of the document implementation and promptly respond to the need for changes.

Rainer Osanik, EU4PFM International Strategic Planning Expert, listed Estonia’s experience in strategic development planning in the Estonia-2035 program. The second level of implementation of the document – development plans for various areas (approved for 7-10 years), the 3^rd level – development programs, for example, the State Tax Service (for the current year and for the next 3 years).

Rainer Osanik said that the Estonia-2035 strategy defines five long-term strategic goals aimed at people, community, economy, environment, and government. The issue of assessing the quality of change was important. Such criteria are the birth rate in the population group, the share of Estonian speakers and those who use Estonian language, participation in cultural life, the share of the population who consider Estonia a safe country, the gender equality index, net greenhouse gas emissions in tons of CO2, Estonia’s place in the world index of sustainable development goals, etc.

“Before discussing the state budget, which takes place in the fall, the State Chancellery provides its members with a statement on solving problems or implementing changes in the strategy, which were discussed in the spring, and what needs to be finalized in preparing the state budget,” Rainer Osanik said.

The purpose of the development strategy of the Ministry of Finance of the country defines such goals as the promotion of financial literacy of the population for 2021-2030, the introduction of a US-based budgeting program (HELLO), etc. In the area of ​​taxation, the country has set a goal of reducing the tax gap and promoting voluntary tax payments by providing simple and understandable services by the state, creating a level playing field for taxpayers, and so on. The participants of the seminar had the opportunity to ask questions and compare the experience of Ukraine and EU countries

Let’s implement changes together!

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