The Digitalization of Relations Between the Tax Authorities and the Taxpayer: Towards a New Era

In a world of constant technological evolution, the tax landscape is also undergoing digital transformation.

A new era is opening for taxpayers and the tax administration, marked by the implementation of new interaction methods. The law proposal of May 12, 2024, set to be gradually enforced until 2028, is at the forefront of this revolution. It replaces the Digilex law of January 26, 2021, by incorporating adjustments to respond to the technological advances of the past three years.

A Legal Framework Shaped by Innovation

Although the foundations of the January 26, 2021 law remain unchanged in this proposal, it now aims to base the relationship between the Federal Public Service of Finance and the taxpayer on the following principles:

• ‍Digital by default: This principle ensures that all communications with the Finance department are conducted digitally. For businesses, digital communication becomes mandatory, making the E-box the main tool for exchanging with the administration. Individuals without a business number will retain the option to choose between digital or paper communication, ensuring flexibility. This obligation also extends to representatives (lawyers, accountants), except in justified exceptions.

• ‍Neutrality: Another key principle is neutrality, ensuring that the mode of communication does not affect the legal consequences of exchanges. Whether using paper or digital methods, the procedural rules and legal implications remain identical. This guarantees equal treatment and avoids discrimination based on the communication method.

• ‍Future-proof: The rapid evolution of technologies requires legislative flexibility. The text is designed to be "future-proof," meaning it is resilient over time without mentioning specific technologies that might become obsolete. This approach allows the legal framework to adapt to future innovations, whether in communication tools, data management systems, or cybersecurity measures.

• ‍Targeted approach: To ensure effective implementation, the law provides for a phased introduction depending on user categories. Thus, businesses or certain categories thereof may transition earlier to full digital, being deemed sufficiently prepared for this shift. The deadline for general enforcement for all taxpayers and representatives is set for January 1, 2028.

The Expected Benefits of Tax Digitalization

The digitalization of exchanges with the tax administration promises several advantages:

• ‍Administrative efficiency: Dematerialization speeds up processing, reduces response times, and avoids errors associated with handling physical documents. By centralizing data on secure digital platforms, the administration will optimize file management, ensuring more rigorous and transparent monitoring.

• ‍Reduction of environmental footprint: The transition to digital communication significantly reduces paper use as well as the costs associated with its processing and archiving. At a time when environmental policies are a major concern, digitalization aligns with a sustainable and eco-friendly approach.

• ‍Simplification for users: The provision of digital tools such as the e-box allows users to have direct and real-time access to their tax documents, emails, and notifications.

Challenges and Issues of the Digital Transition

While digitalization promises many benefits, it also comes with significant challenges that cannot be ignored:

• ‍Digital divide: Despite efforts to make technology accessible to everyone, part of the population remains vulnerable to digital exclusion. The elderly, low-income households, or those living in remote areas may struggle to access these digital tools, further amplifying an existing digital divide. To address this issue, support measures will need to be put in place, such as specific training, public access points, or dedicated assistance services.

• ‍Cybersecurity and data protection: The shift to fully digital communication comes with increased risks in terms of cybersecurity. Tax data is particularly sensitive, and its protection becomes a top priority. Phishing attacks, hacking attempts, or system vulnerabilities must be anticipated with robust security measures and enhanced protection of personal data in compliance with the GDPR (General Data Protection Regulation).

• ‍Inequalities in technological preparedness of businesses: Not all businesses, especially SMEs, have the same resources to cope with mandatory digitalization. Some may struggle to adapt to the new requirements without adequate support.

A Future to Build Together

The digitalization of relations between the tax authorities and the taxpayer will mark a decisive turning point in terms of efficiency, transparency, and reduction of environmental footprint. However, for this transition to be successful, it is crucial to support the most vulnerable taxpayers, strengthen digital infrastructures, and rigorously protect tax data. If lawmakers can meet these challenges, the digitalization of tax exchanges could truly usher in a new era of communication between the tax authorities and the taxpayer.

We will be by your side throughout this transition to help you adapt to the new digital era.