A government’s service provision to enterprises via electronic means has a significant impact on the productivity levels of such country’s economy. One of the tax procedures with the greatest impact on economic activity and government capacity to enforce compliance with tax obligations is the use of invoices. The electronic invoice is the digital equivalent of the traditional paper invoice. In recent years, several Latin American countries have begun to adopt the electronic invoice. The modernization of this tax procedure has had a great impact in increasing the efficiency and effectiveness of tax administration and in turn has fostered business development.
Top2. Economic Impact Of The Electronic Invoice
A government’s ability to provide services to private companies electronically has a significant impact on the productivity levels of such country’s economy. It has been shown that, by improving government efficiency and effectiveness, electronic services reduce companies incorporation costs, operation costs, and local and international investment costs. (IADBC, 2005; United Nations, 2008)
As such, the strategic use of information and communications technology (ICT) facilitates government promotion of competitiveness and the economic development in many different sectors, communities and regions (Sotelo Nava, 2005). In particular, ICT facilitates administrative procedures and fosters information exchange between the State and the private sector (CCS, 2009). At the same time, the introduction of the ICTs increases the transparency of dealings between the State and private companies and reducing opportunities for corruption. (Ojha Amitabh et al., not dated)
According to the Report on European Competitiveness 2004 (European Union, 2004), there are three areas in which the governments primarily influence the competitiveness levels of private economic agents: (a) tax policy; (b) fiscal policy; and (c) legal framework.
Public services via the web increase the tax policy transparency and facilitate access to information on matters such as tax regulations and forms required for tax payment. Moreover, they significantly reduce processing and transaction costs associated with compliance with the tax obligations. Thereby they improve transparency of public sector expenditure affecting private sector competitiveness. For example, in the area of public procurement, internet service provision may significantly reduce the costs for companies, particularly such costs related to entering the market (for example, authorization to operate and permits) and the establishment and/or expansion of productive investments.