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National Tax Service Vice Commissioner Mun Hee-chul (NTS) |
On Sept. 24, the National Tax Service held an opening ceremony at its Seoul Regional Office for the Seoul branch of NTS Data Lab. This is the first offshoot of the NTS Data Lab, which has been in operation in the city of Sejong since 2018.
The NTS Data Lab is a secured facility whose main purpose is to promote research that may inform tax policies. It gives researchers access to microdata that had been used to compile national tax statistics for further analysis.
Most of the data held by NTS originated from taxpayers and contains personal information as well as potentially sensitive trade secrets. In order to protect the privacy and secrecy of taxpayer information from breaches, the data is safeguarded by a robust security system and strict confidentiality principles.
Privacy concerns aside, national tax data is a rich body of information on the economic activities of the people. Analysis of this data is crucial to reviewing, evaluating and improving tax policies. The NTS Data Lab supports this important task of data-driven policy research while ensuring the privacy of the taxpayers we serve.
The NTS Data Lab is a highly secured and controlled facility, which means that no microdata can be carried out of its premises and only authorized data may be brought into it from outside. Researchers may access the microdata through the NTS Data Lab only after the tax administration has sanitized it of elements that can identify the taxpayer.
After the microdata analysis is complete, the researchers may receive the final analytical output to take with them subject to approval. This adds one layer of rigorous screening to make sure that taxpayers linked to the data cannot be identified.
Research based on such valuable tax data is used extensively in Korea for various purposes, such as developing tax policies and evaluating their effectiveness.
Last February, the NTS expanded access to its Data Lab, which had been restricted to the central and local government bodies and government-funded research institutes in the past, to allow universities and private research bodies to also use the data. The branch lab in Seoul was opened in September to make it easier for those who are based in and around the capital city to utilize its services.
NTS plans to engage in active public relations and information sharing efforts so that we can expand our client base and ultimately increase the use of the Data Lab.
Another priority for the revenue agency has been to provide better statistical information to taxpayers in general.
NTS utilizes large volumes of tax data to generate various statistics, which it then discloses for public use. Such efforts make tax administration more transparent, serve the people’s right to know and provide useful information that can support economic activity.
A great example of this endeavor is the Yearbook of National Tax Statistics, which the NTS has released since its establishment in 1966. The annual publication is available both in print and online.
The current system, however, is limited in its capacity to tailor statistical data to meet user needs and to present information in visual format, such as graphs.
To address these impediments, NTS is developing a portal dedicated to providing statistical services in ways that are more customized to user needs. The new portal, tentatively called Tax Statistical Information Service, will be connected to a database of tax statistics and equipped with features that will make it more user-friendly. For example, it will be able to present time series data, provide visualized contents by theme and sector and compile statistics based on user requirements. The portal will go live in 2021.
In addition, NTS has plans to generate new statistics on topics of great public interest, such as the earned income tax credit and child tax credit for dissemination in the future.
Data is, without a doubt, the single most valuable resource in the age of the fourth industrial revolution, marked by big data technologies, artificial intelligence and the internet of things. NTS will continue efforts to make tax data and statistics more accessible so that they may be utilized effectively across various sectors of Korean society.
By Mun Hee-chul
Mun Hee-chul is vice commissioner of the National Tax Service. Views reflected in this article are his own. -- Ed.
