By E.OYUN-ERDENE

The following interview is from a head of Mongolia’s General Taxation Office (GTO), B.Battomor.

-The Government selected the best tax payers and rewarded them in 2011. During this selection, the most tax payers were mining companies, so the Prime Minister considered the inspection on financial and construction sector should be increased. Are the financial and construction sector working without any benefit or are they simply hiding their income?
-The best tax payers are selected from many places. In particular, there is a tradition which Mongolian National Chambers of Commerce and Industry lists the top entities. From 2011, the government has started to select the best tax payers. 100 entities which paid the most taxes in the first three seasons in 2011 were selected by the Government. This might be why the financial and construction sectors weren’t involved in the list. The construction companies make their tax report by accrual basis which the report is made after the State Commission received and operated. So, maybe the construction companies had a reason. Also the banks are same as construction companies and the amount of taxes are defined definitively by February 10. So in February, Mongolia’s General Taxation Office will select the best tax payers.

-So in February, the real best tax payers will be selected?
-Generally, yes. After the definite report of tax payers, financial and construction companies can be added to the list.
-What work is Mongolia’s General Taxation Office doing against the Black Economy?
-We are working on many things against the Black Economy. In particular, we are implementing the risk management from 2011. Also, we aimed to make their all activities electron and we will reward the entities which use this method. By doing this, there will be no trouble for tax payers and they can work quickly. Furthermore, we are discussing to make change in law on VAT (Value Added Tax).
-When implementing the risk management, there will be much more chance for trustful tax payers?
-We will define entities they are risky or safe and the report of the safe entities will be taken without any check. And the risky entities will be checked.
-If the safe entities make mistakes on their report, what about the responsibility?
-A mistake can be purposive or accidental. We will re-consider the accidental mistakes, but the entities which try to escape from the taxation and to hide their incomes will be checked more accurately and punishment will be levied.