ADB's ICT-Focused Support to Improve Mongolia's Tax, Governance Efforts | Asian Development Bank

ADB's ICT-Focused Support to Improve Mongolia's Tax, Governance Efforts

News from Country Offices | 21 September 2018

ULAANBAATAR, MONGOLIA (21 September 2018) — The Asian Development Bank’s (ADB) Board of Directors has approved a $25 million loan to help the Government of Mongolia improve its tax administration and public investment management using information and communication technology (ICT).

The Mongolian economy’s shift in the late 1990s from a reliance on livestock herding to focusing on mining has made the country’s finances highly vulnerable to fluctuating global commodity prices.

“A well-functioning system to manage taxes on one hand and better public investment management on the other hand should help Mongolia weather volatile commodity prices and channel funds into much-needed infrastructure investment,” said ADB Financial Sector Specialist for East Asia Mr. Seung Min Lee. “And using ICT will be more efficient and transparent, which will help attract local and foreign investment.”

Mongolia’s current tax administration system consists of well-defined business processes. However, the existing ICT systems for tax administration in the country are fragmented and inefficient. This is also true of the country’s public investment management system, which has caused delays in some investment projects, leading to cost overruns for the government.

The Strengthening ICT Systems for Efficient and Transparent Public Investment and Tax Administration Project will streamline processes for tax administration and public investment in line with international good practice. It will support the Mongolian Tax Authority (MTA) in its tax collection efforts by establishing an information system and providing required ICT infrastructure—network, security, computing, and storage infrastructure—to host it. This will allow the government to identify current and prospective taxpayers.

Additionally, the project will support the Budget Investment Department (BID) to develop an ICT-based public investment management information system to help the government select the investment projects that will bring most benefits to the country and better manage them. Government staff, notably those from MTA and BID, will also be trained in the operations and maintenance of these information systems.

The project is part of ADB’s continuous efforts to improve public financial resource mobilization and management in Mongolia.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 67 members—48 from the region. In 2017, ADB operations totaled $32.2 billion, including $11.9 billion in cofinancing.