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Customer story: Smoother services and more efficient cooperation between authorities – Tax Administration can get help from Data Exchange Layer also for investigating tax fraud

Publication date 30.5.2022 14.25 | Published in English on 30.5.2022 at 14.34
Press release

Finland and Estonia started to exchange information between their tax authorities with the help of Data Exchange Layer in 2021. The cooperation, in which data is exchanged in real time and securely, has benefited both countries. The Finnish Tax Administration uses the Data Exchange Layer to also exchange information between different authorities in Finland. Among other things, the cooperation reduces bureaucracy and makes it easier for citizens to use services. It has also been possible to detect fraud earlier than before.

Real-time exchange of information between Finland and Estonia has been the aim of the Tax Administration for a long time. The Data Exchange Layer made it possible in 2021. Information has been exchanged with Estonia even before that, but it all requests for information exchange were carried out manually, which required a lot more resources.

 – When confidential information is transmitted, the channel for exchanging the information must be secure. Without the secure Data Exchange Layer, it would hardly have been possible to exchange information in real time with Estonia, says Ann-Sofi Johansson, Head of International Information Exchange at the Tax Administration.

Tax information is exchanged between Finland and Estonia in matters such as VAT monitoring and personal and corporate taxation. 

Saved working hours and higher quality of work

Real-time exchange of information that facilitates citizens’ use of services makes the authorities’ work more efficient and improves its quality. The exchange of information between the Finnish and Estonian authorities through the Data Exchange Layer has saved several hours of work and reduced the number of human errors, as the need for manual work has decreased significantly.

Real-time exchange of information is important in preventing different kinds of tax fraud and crime. Of course, abuses have been solved before, too, but timely information reduces the need to rectify decisions that have been made on the basis of outdated information. For example, VAT monitoring can detect fraud attempts in time with the help of the Data Exchange Layer. This is important already at the registration stage, so that the applicant can be denied access to the Finnish VAT register, if necessary. This also keeps the register clean.

Joining the already existing infrastructure through the Data Exchange Layer was convenient

With regard to sharing tax information, Estonia is Finland’s most important partner country. Fortunately, it was easy to build a secure and real-time information exchange channel between the countries. 

Estonia’s existing X-Road infrastructure, to which the electronic services of the Finnish Tax Administration could be joined with the Data Exchange Layer, was a great help.

– Building cooperation in an already existing infrastructure was easy. The Digital and Population Data Services Agency offered us a functional service and ensured that everything worked. Cooperation with them has been straightforward, says Sanna Savolainen, Product Group Manager at the Tax Administration.

Information submitted once is also sufficient in Finland

Citizens will also benefit from the use of the Data Exchange Layer when there is less bureaucracy and using the services becomes smoother. Fewer paper forms will also be needed. In addition, the processing times will be shorter when the information is transferred directly from one authority to another.

– Our aim is that the information moves smoothly between different authorities, and citizens only need to submit the information once. Fortunately, we have already been moving in this direction, and in many places the citizen's transactions have been made easier, says Savolainen.

Tax Administration is planning to offer and use more services through the Data Exchange Layer

The Tax Administration also makes extensive use of the Data Exchange Layer in Finland with several different authorities and organisations. Information is exchanged in real time with parties such as Finnish Customs, the National Land Survey of Finland, Financial and Debt Counselling and the Finnish Transport and Communications Agency (Traficom). For example, various registration permit surveys are carried out and authorisations are verified through the Data Exchange Layer. 

 – Other services related to transferring data are also on the way. We use the Data Exchange Layer as a solution when it is the most technologically appropriate method. In general, it can be said that reliable real-time information is essential, Savolainen sums up.