TERMS OF REFERENCE Ref: PN/FJI Taxpayer Onboarding Digitization of the tax system in the Solomon Islands

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1 Title Location Application deadline Type of Contract Languages required: Duration of Initial Contract: TERMS OF REFERENCE Ref: PN/FJI Taxpayer Onboarding Digitization of the tax system in the Solomon Islands Solomon Islands 30 th June 2018 (Fiji Time zone) Individual Contractor English 35 working days from 9 th July to 28 th September 2018 BACKGROUND Objective The main objective of the assignment is to develop and review strategies and taxpayer-related awareness media and material to onboard taxpayers to the modernised tax payment and tax system for the Solomon Islands. These strategies and taxpayer-related awareness media and materials must be developed cognizant of the different categories of Solomon Islands taxpayers and tax agents that interact with the tax system. Background - Pacific Financial Inclusion Programme (PFIP) PFIP is a Pacific-wide programme that has helped 1.5 million low-income Pacific islanders gain access to financial services and financial education. It achieves these results by funding innovation with financial services and delivery channels, supporting policy and regulatory initiatives, and empowering consumers. PFIP operates from the UNDP Pacific Office in Suva, Fiji and has offices in Papua New Guinea, Samoa and Solomon Islands. It is jointly administered by the UN Capital Development Fund (UNCDF) and the United Nations Development Programme (UNDP) and receives funding from the Australian Government, the European Union and the New Zealand Government. Background on the Assignment The Solomon Islands Government Inland Revenue Division s modernisation of the tax system project involves the digitisation of the Government Revenue Management System, vastly transforming the tax and payment landscape in the Solomon Islands. The project, which was formally launched in August 2017, will result in the end-to-end automation of the receipt, assessment, payment and reimbursement of all tax types for both, corporate and individual taxpayers of the Solomon Islands. The project, which falls in the G2P/P2G space within the PFIP Policy workstream will deliver six core achievements: 1. Modernising the tax Revenue Management System by digitising the process of submission, assessment, response, payment and analysis for Goods Tax, Sales Tax, Pay as You Earn (PAYE) & PAYE reconciliations, Income Tax and Withholding Tax. 1

2 2. Facilitating self-management of tax obligations by taxpayers via e-filing of tax returns using an IRD web portal for registered online taxpayers and facilitating the generation of e-payments of taxes via commercial banks (internet banking, ATM, EFTPOS and over-the-counter) and managing communications with IRD. 3. Maintaining equity and fairness of taxes across the taxpaying population, by ensuring that taxpayers, more particularly salary and wage earners pay no more and no less than their tax obligations. 4. Timely & accurate assessments of tax payments for clients of the IRD, with a focus on the nearly 123,800 salary and wage earners who are eligible to receive tax assessments. It is estimated that the majority of salary and wage earners currently do not request or receive a tax assessment. 5. Bringing into the formal financial sphere taxpayers who do not presently interact with formal financial services, but who will be using formal financial products and services to make and receive tax-related payments, thus also helping these customers build a critical transaction history needed for future transactions with financial service providers. 6. Building individual, small business and corporate customers familiarity and trust with financial service providers, the financial system and electronic transactions through successful interactions with payments and receipts relating to taxes. As a direct outcome of the project, a projected 123,800 wage & salary employees, 200 corporate taxpayers and 3,684 small businesses will be able to undertake tax-related transactions with the Solomon Islands Government in a timely and efficient manner, leveraging automated online services and electronic payment channels. PFIP s specific intervention in the modernisation activity creates the linkages to the client, which either do not exist, or do not exist in a structured manner. These key linkages are between the taxpayer and the IRD but also critically between the taxpayer and the formal financial system/ formal financial service providers. The intervention forms the critical component in the IRD s tax revenue modernisation efforts and will comprise the development and implementation of the technological solution to the IRD s Revenue Management System for five tax types, banking linkages, business processes, training of IRD staff together with support services from the technological service provider. The IRD also proposes to plan and implement comprehensive user education and awareness on E-filing and E-payments of taxes including appropriate financial literacy linked to the deployment. DUTIES AND RESPONSIBILITIES Scope of work The following are the tasks identified for this activity: a) The activity firstly covers the review and strengthening of existing strategies to onboard 200 corporate taxpayers, 15 tax agents, small businesses and individual taxpayers to use the 2

3 modernised tax system for the purposes of submission, responses on assessments and queries, payment and related matters for Goods Tax, Sales Tax, Pay as You Earn (PAYE), Income Tax and Withholding Tax and should include the identification of the optimal channels for communication with these. A specific area of focus is on the small businesses and individual taxpayers. b) Secondly, the activity involves the development of, review and finalisation of a suite of customer and awareness materials and programmes pertaining to the modernisation project specifically for corporate taxpayers, tax agents, small businesses and individual taxpayers. Where resources are identified as required, but currently do not exist, these will be developed. This suite of materials and programmes will be built on existing materials and training programmes currently in either draft or finalised form as developed by the Solomon Islands Inland Revenue Department. c) Thirdly, the activity includes the development of easy-to-use guides for corporate taxpayers, tax agents, small businesses and individual taxpayers for the purpose of using and interacting with the online system for the purposes of submission, communicating and responding to assessments or making queries, payment and any other related matter. d) In undertaking this activity, the following must be seriously considered and appropriate strategies designed to enhance opportunities and to mitigate risks: i. To ensure a sustainable and effective approach to taxpayer onboarding in the development of strategies, taxpayer materials/resources and guides; ii. The existing human capacities, institutional structures and resources available within IRD to implement the taxpayer onboarding; iii. iv. Optimize ownership and buy-in from all key stakeholders; and To ensure effective and efficient onboarding particularly of small business and individual taxpayers in Phase 2 of the project. A consultative approach to the design, development and review of the strategies and materials/resources and guides must be used. To undertake this task, the successful consultant will receive the following: An in-person briefing from the Inland Revenue Department on current efforts for taxpayer onboarding; Current draft or finalised taxpayer onboarding documentation and any draft or finalised taxpayer user guides; and An in-person briefing from the Pacific Financial Inclusion Programme on the modernisation of the tax system project with the Inland Revenue Department. In undertaking this activity, the consultant may need to undertake some limited research activity to pursue further Financial Inclusion or taxpayer information pertinent to the Solomon Islands, to media and communications widely accessible in the Solomon Islands or other information relevant to the activity. Expected Outputs and Deliverables Mid-term report accepted by both PFIP and the Solomon Islands Inland Revenue Department with attached: - Finalised strategy for onboarding corporate taxpayers, tax agents, small businesses and individual taxpayers. The strategy must be accepted by IRD prior. 3

4 - IRD accepted suite of customer and awareness materials and programmes for corporate taxpayers and tax agents. - IRD accepted, easy-to-use guides for corporate taxpayers and tax agents. Final report accepted by both PFIP and the Solomon Islands Inland Revenue Department with attached: - IRD accepted, suite of customer and awareness materials and programmes for small businesses and individual taxpayers. - IRD accepted, easy-to-use guides for small businesses and individual taxpayers. The form and frequency of progress reports during the term of the assignment will be agreed between the successful bidder and PFIP. During the term of the assignment the specialist will report to the G2P/P2G Technical Specialist at PFIP. Institutional Arrangement e) The successful bidder will provide their own work equipment, computer programmes, printing, telephone and internet connectivity for this activity. f) When the consultant is in Honiara, work space will be provided at the Inland Revenue Department. Duration of the Work g) The suggested level of effort of the assignment will, entail an estimated 35 working days, for the development of taxpayer onboarding mechanisms, review of existing onboarding strategy, together with the review, development and finalisation of taxpayer advocacy materials and information guides. h) The successful bid will be expected to manage the scope of the activity with minimal PFIP oversight. These estimated working days are not necessarily consecutive and are expected to be completed by 28 September i) A maximum of 20 working days of this activity (which does not include travel time) can be spent in Honiara, Solomon Islands. The estimated level of effort for this activity has been represented below. Deliverable 1 15 days Deliverable 2 20 days The actual level of effort will be subject to periodic review by the Pacific Financial Inclusion Programme during the course of the activity. Duty Station j) The work assignment is in Solomon Is. k) The form and frequency of progress reports during the term of the assignment will be agreed between the successful bidder and PFIP. l) During the term of the assignment the specialist will report to the G2P/P2G Technical Specialist at PFIP 4

5 COMPETENCIES Strong interpersonal and communication skills; Strong analytical, reporting and writing abilities skills; Ability to plan, organize, implement and report on work; Ability to work under pressure and tight deadlines; Proficiency in the use of office IT applications and internet in conducting research; Outstanding communication, project management and organizational skills; Excellent presentation and facilitation skills. Demonstrates integrity and ethical standards; Positive, constructive attitude to work; Displays cultural, gender, religion, race, nationality and age sensitivity and adaptability. REQUIRED SKILLS AND EXPERIENCE The scope of work will require one specialist with relevant expertise and a proven track record in taxpayer onboarding for digital tax systems or with onboarding customers to digital financial services or digital financial service platforms. The desired working style must be empowering to national partners and foster optimal application of local knowledge and capacities in undertaking and delivering the tasks identified. Following are individual requirements: Educational Qualifications: Masters degree in Business, Economics, International Development, Social Sciences or related. Experience Min. of 5 years of experience with onboarding taxpayers or financial service customers to digital tax systems and/or digital financial service platforms. Min. of 5 years of experience with the development, review and release of customer awareness materials and/or customer/business user guides. Experience in the Pacific or other developing country context. Experience in financial inclusion. Language requirements Fluency of English language is required; Price Proposal and Schedule of Payments Consultant must send a financial proposal based on Lump Sum Amount. The total amount quoted shall be all-inclusive and include all costs components required to perform the deliverables identified in the TOR, including professional fee, travel costs, living allowance (if any work is to be done outside the IC s duty station) and any other applicable cost to be incurred by the IC in completing the assignment. The contract price will fixed output-based price regardless of extension of the herein specified duration. Payments will be done upon completion of the deliverables/outputs and as per below percentages: Deliverable 1: Mid-term report accepted by both PFIP and the Solomon Islands Inland Revenue (40% of total contract amount) Deliverable 2: Final report accepted by both PFIP and the Solomon Islands Inland Revenue Department (60% of total contract amount 5

6 In general, UNDP shall not accept travel costs exceeding those of an economy class ticket. Should the IC wish to travel on a higher class he/she should do so using their own resources. In the event of unforeseeable travel not anticipated in this TOR, payment of travel costs including tickets, lodging and terminal expenses should be agreed upon, between the respective business unit and the Individual Consultant, prior to travel and will be reimbursed. Cumulative analysis The award of the contract shall be made to the individual consultant whose offer has been evaluated and determined as a) responsive/compliant/acceptable; and b) having received the highest score out of set of weighted technical criteria (70%). and financial criteria (30%). Financial score shall be computed as a ratio of the proposal being evaluated and the lowest priced proposal received by UNDP for the assignment. Technical Criteria for Evaluation (Maximum 70 points) Masters degree in Business, Economics, International Development, Social Sciences or related. (10%) Min. of 5 years of experience with onboarding taxpayers or financial service customers to digital tax systems and/or digital financial service platforms. (30%) Min. of 5 years of experience with the development, review and release of customer awareness materials and/or customer/business user guides. (25%) Experience in the Pacific or other developing country context. (3%) Experience in financial inclusion. (2%) Only candidates obtaining a minimum of 49 points (70% of the total technical points) would be considered for the Financial Evaluation. Documentation required Interested individual consultants must submit the following documents/information to demonstrate their qualifications. Letter of Confirmation of Interest and Availability using the template provided in Annex II. P11 Form (Annex III), indicating all experience from similar projects, as well as the contact details ( and telephone number) of the Candidate and at least three (3) professional references. Technical proposal which includes a brief description of why the individual considers him/herself as the most suitable for the assignment Financial proposal, as per template provided in Annex II Incomplete proposals and proposals sent to the wrong mailing address may not be accepted. Annexes Annex I - Individual IC General Terms and Conditions Annex II Offeror s Letter to UNDP Confirming Interest and Availability for the Individual IC, including Financial Proposal Template Annex III P11 Form For any clarification regarding this assignment please write to ronald.kumar@undp.org. Complete proposals should be submitted to etenderbox.pacific@undp.org by 30 th June 2018 (Fiji Time). 6