Author(s): Najim Abd Aliwie Al Karaawy
There is a current proposal in the UK to overhaul the tax reporting system from the analogue paper filing format to an online, digitized format. The proposal is better known as the Making Tax Digital (MTD) initiative designed by the Her Majesty Revenue & Customs (HMRC) body. The program is meant to put the tax reporting framework on a digital platform in order to make it tax returns convenient, fast, and error-free. The traditional paper files which are usually done only once in a year, hence are full of errors, lack precision, and tedious in terms of file storage and access. The HMRC strongly advocate for the implementation of the MTD scheme as they allege that taxpayers and corporate businesses will be able to save reporting costs, can access tax accounts in real-time, avail fast access to accountants, and enable the HMRC avoid losses from certain tax omissions. Despite the evident benefits, several bodies such as the FSB and the CERB claim that the exertion of the MTD will surely impose pricey transition costs for small businesses, who have to purchase certain hardware and software equipment to run MTD. The study therefore conducted a systematic literature review analysis to shed more light on whether the MTD is truly a worthwhile project to pursue or not. The results show that the MTD is, indeed, worthwhile and will definitely be a global technological innovation for all current economies; owing to its digital mobility, fast access to information, and real-time tax reporting amongst many other benefits.