Outside the country, Denmark is known for its high tax rates. This would probably lead people outside Denmark to believe that the Danish taxation system is a well-oiled machine. If you live in Denmark, you know this is hardly the case however, as the Tax Department has been riddled with scandals.

These scandals have mostly related to IT projects, but in recent times, they have also related to bad controls, which have led to foreign swindlers getting tax returns that they should not have had in the region of $2 billion. On top of that, are problems with collecting back taxes and other money owned the state.

The scandals, and especially the loss of such a huge amount, has led to a major reform of the tax department.

Bloomsberg writes about it in this article: Billions in Losses Trigger Danish Overhaul of Taxation Model

Of course, the headline of the Bloomsberg article is nonsense – the Danish taxation model is going to stay the same. Rather it is the processes for paying out tax returns and collecting past taxes is getting overhauled, with more controls and better IT systems. As part of the overhaul, the department system of the Ministry of Taxation with get overhauled, splitting the Tax Department (which is one of the departments under the Ministry) into several departments. This is done to strengthening the expertise in the problem areas.

As someone who works with IT projects, I am curious of how the new structure and focus will change their way of doing IT. Many of the projects have in the past been huge projects, largely based on the waterfall model,  but in the last couple of years, both the Ministry of Taxation and the Taxation Department have tried to change this. The Ministry of Taxation has tried to change it by doing the development themselves, while the Taxation Department has tried to break projects into smaller bits, and using Agile.

All in all, it seems like a great idea to overhaul the department and ministry, but it comes down to the actual implementation.