Some of us are well aware of the pains the month of April brings. This is when taxpayers have to pay their dues to the country. Thus, when the Inland Revenue Board of Malaysia (IRBM) introduced web-based e-filing in 2006 — which meant we could file our taxes online, in the comfort of our homes — it was warmly received.
However, as the saying goes, nothing will get done until the 11th hour. And Malaysians are no different when it comes to filing their taxes. So this year, says Mazlan Wan Chik, director of corporate communications at IRBM, the team chose to use reverse psychology in getting taxpayers to fulfil their duties on time.
Hasmah (seated) flanked by Sani (left) and Mazlan (right)
It took out an advertisement called Lucky Child, which depicts the stressful situation of a man stuck in traffic while trying to get his wife, who is in labour, to the hospital. In the midst of his predicament, he finds his head heavy with questions as a father to be, such as will he be able to provide security and comfort for his child?
In the final few scenes, as he gazes at his newborn child, he realises how lucky his son is to be born in peaceful Malaysia. The advertisement then ends with the tagline: “Prosperity cannot be achieved without sacrifice.”
“Our previous TV commercial was very instructional. It was a step-by-step guide on how to use e-filing. This year, we didn’t even mention e-filing. For the very first time, we checked the blogosphere and people were discussing our new campaign. We want to appeal to the taxpayer’s emotions. People must know that when you are paying taxes, you are investing in yourself and your future,” says Mazlan.
In the last three years, it has become almost customary for taxpayers to use the e-filing system at the very last minute. This year, 50% of the e-filing was done in the last three days before the April 30 deadline.
With users growing every year, IRBM needs to be more creative in encouraging early filing because the surge in traffic as the deadline nears is a huge headache for the agency. The first year that the web-based system was introduced, the number of filers was about 189,000. This has now risen to 1.5 million.
Datuk Hasmah Abdullah, CEO of IRBM, says this is the typical behaviour of Malaysian taxpayers. “This year, we went on all the radio stations and TV to tell them [taxpayers] to file their taxes early. We used to tell them to file before the deadline but not anymore.”
Currently, the system is deployed on four application servers and backed by three database servers. A load balancing software is used to redirect traffic to each server. One may argue that the number of servers is small for a nationwide application, but according to Sani Taib, the director of the e-services division, even at peak time, the application servers reach only 40% of their full capacity. For the database servers, it is 30%.
The bottleneck, he says, is in the network connections outside. Once a filing is in, he says, the agency’s internal 69MB line is enough to do the job in a few minutes. “By right, part of the problem is not caused by us, but next year, we plan to increase our internal bandwidth during the peak period, so that our servers can be fully utilised.”
As increasing the bandwidth for a certain period will likely incur charges for IRBM, it is currently in talks with its service providers Telekom and Jaring to come up with some arrangement.
This year, IRBM also introduced a time-out function, which cuts off idle connections of more than 10 minutes to avoid users from hogging the bandwidth. Not surprisingly, a lot of the complaints from users this year were about their connections timing out.
E-filing undergoes improvements every year. An integral component of e-filing is the digital certificate, which is used to authenticate a user’s digital signature. In 2006, the digital certificates had to be downloaded to the hard drive for entry into the system. In 2008, with roaming public key infrastructure (PKI) — a management system for digital certificates — users could log in from anywhere for the service.
The total cost of the system over the past three years was about RM34.7 million. The biggest portion was for the PKI, undertaken by Digicert Sdn Bhd at RM11.5 million. Digicert is one of the only two companies authorised to provide such services to the government. The other is MSC Trustgate. Digicert also provides the filing system for tax agents. “Some of the other ministries will be leveraging our PKI for their e-services since we have an extensive database of taxpayers,” says Hasmah.
All of the e-forms were developed in-house. The payment system e-bayar uses the Financial Process Exchange as the gateway, with the integration done by MEPS, a conglomerate of local financial institutions.
With such heavy investments, Hasmah says it is imperative for IRBM to increase the number of users. Its target is 100%. “It is not impossible but it will be difficult,” she adds.
Moving forward, IRBM is exploring the possibility of speeding up the process by pre-populating the e-forms with the income details of taxpayers. Another trend it sees is the popular usage of mobile e-services. However, Hasmah says the nature of e-filing involving long data entries might be unsuitable for mobile users without smartphones. “What we can do is send reminders to their phones and maybe issue passwords. Right now, we have Gerbang SMS, which enables users to check their PCB [scheduled tax deductions].”
Hasmah is especially proud of the fact that IRBM has been able to make refunds within a year in clear-cut cases since she came onboard as CEO in 2006. “My approach is that you need to pay taxpayers back something in order to appease them. Last time, this was based a lot on requests and complaints. We are still clearing backlog. But for the current year, we can clear them within the year itself,” she says.
E-services have come a long way in helping both the public and the government. With a tenfold increase in tax collection since introducing e-filing, IRBM is definitely happy with the progress. “There are more things to come,” promises Hasmah.