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A number of countries, particularly in the developing world, have rest fact urea their revenue authorities to provide for large taxpayer units (LTUs).

      

A number of countries, particularly in the developing world, have rest fact urea their revenue authorities to provide for large taxpayer units (LTUs).

Required;
i) Explain three reasons that have motivated the formation of LTUs.
ii) As a tax consultant in a country that intends to form an LTU, describe three key functional areas of an LTU.

  

Answers


Wilfred
i) Reasons for the formation of Large Tax Units (LTUs.)
- To enhance efficiency in the/collection of taxes from the LTU’s as they contribute the biggest proportion of the tax revenue.
- To ensure challenges faced by LTU’s on tax matters are prioritized and addressed in view of their contribution.
- To seal potential loopholes that might be used by tax evaders given that, for LTU’s any acts of tax evasion may substantially affect revenue collection.

ii) Key functional areas for an LTU
-Operations
This will handle administrative /matters including receipt of taxes and processing of refund.
-Research
This will conduct investigations on suspected cases of evasion and avoidance in addition, it will be continuously researching on and identifying new/potential taxpayers.
-Customer service/liaison
This will be responsible for establishing, maintaining and enhancing good relations between the LTV and the taxpayers. It will address matters relating to complaints, objections and queries from customers.
Wilfykil answered the question on February 25, 2019 at 11:53


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