Closing Remarks by Kunio Mikuriya

Closing remarks by Kunio Mikuriya
Ladies and Gentlemen,
This Conference has confirmed that revenue management continues to be of the utmost interest and
importance to many WCO Members. The Conference has identified valuable instruments, experiences,
best practices, tools and capacity building opportunities to assist WCO Members with their revenue
management responsibilities. The discussion has shown that risk management that integrates two
elements that Customs should assure, namely, trade facilitation and control whether it is for purposes of
revenue management, supply chain security, or community protection, remains very important. This
Conference also discussed the impact of the global economic downturn and its resultant reduction in
trade volumes that have lowered revenues. In addition, it is apparent that tax avoidance has increased
during the crisis. Finally, this Conference has issued a clarion call that more needs to be done by the
WCO, by WCO Members themselves, and by partner organizations to assist WCO Members, especially in
the developing world, with their core responsibilities.
We have talked about organizational structure. It was Chairman of the Office of the Revenue
Commissioners in Ireland, Josephine Feehily, who said that strategy and leadership are more important
than the organizational model. And this was backed up by other speakers, such as the Director of
Customs and Excise at Her Majesty’s Revenue and Customs in the United Kingdom, Mike Norgrove, who
mentioned that the structure should be fit for purpose. I could not agree more – if we have outstanding
strategy and leadership supplemented by the use of WCO instruments and tools, the organizational
structure will take care of itself.
The choice of organizational structure has been discussed. Michael Waweru, Kenya Revenue Authority’s
Commissioner General, talked about the success stories of the revenue authority model, and also
identified what the elements of success were and what lessons had been learned. He underlined the
importance of continuity and sustainability of leadership in the reform process. Thus, perseverance is
necessary. Enriko Aav, the Director General of the Estonian Tax and Customs Board summarized what is
important in the strategy; namely, how to improve compliance and how to reduce the burden on
legitimate trade – trade facilitation in other words. He also noted the importance of risk management and
communication.
When choosing a revenue model it is necessary to consider the conditions under which Customs operate
as well as the national environment. Juan Toro from the IMF pointed out that it is clear from the
discussions that there are many different forms apart from the revenue authority model. It is also clear
that revenue authorities are complex and expensive to set up. Mr. Toro said that the IMF does not
advocate the establishment of revenue authorities as a panacea or cure-all. It is a part of the overall
reform programme and I agree with his view.
There is also the issue of the cost of reform. As mentioned by Mr. Waweru, there must be appropriate
funding from the Treasury, not only from development partners, to successfully implement reforms. It
will give a measure of flexibility to the choice.
There is a continued need to work closely with our colleagues in the private sector. As the Director
General of Customs from Morocco, Abdellatif Zaghnoun, put it, the Customs-to-Business partnership is
not a choice, but a necessity. Such partnerships must be based on ethical principles and transparency.
At the time of revenue management reform, Customs skills must not be lost. Carol West, the Chairperson
of WCO Private Sector Consultative Group stressed that there is a risk in reform, especially organizational
integration, that the highly technical and unique skills of Customs officers can be damaged. This is one
area where we have to be really careful. She also emphasized the importance of predictability in Customs
controls. This of course is a key tenet of the WCO’s revised Kyoto Convention, and we maintain that
predictability is crucial not only for trade facilitation but also for better revenue management.
Enhancing integrity also contributes to better revenue management. Data analysis shows that corruption
does not cause inefficiency, but rather inefficiency causes corruption. Thus, reducing red tape is not only
beneficial for trade facilitation, but is very helpful for integrity and revenue management. Participants had
extensive discussions on how to reduce corruption, including such measures as internal investigations,
audit, codes of conduct, and data analysis.
Performance data can greatly assist us to do our job better. As Bryane Michael from the Stockholm
School of Economics indicated, it should not be about a test or an evaluation; it should not be about
pointing a finger; it should be about improving organizational output. In this respect Seán Moriarty from
the OECD noted that benchmarking could play an important role. And linked to this point, performance
data should be about outcomes not inputs.
We have also heard about the importance of information exchange and information technology; these are
crucial elements that must be mastered to improve performance. Related to that, Jian Liu from China’s
Mission to the EU talked about the importance of international cooperation in combating commercial
fraud. Peter Malinga, Commissioner of Customs and Excise in Uganda had a good point about the need
for information and data management based on collected data. International cooperation, as emphasized
by Mr. Liu, is one way, but how to actually make better use of data for revenue management purposes is
what we must cope with.
The WCO has conducted a series of regional seminars to discuss revenue management or the revenue
package, and one recurrent issue is how we can deal with informal trade. In this area, Herminio Sueia
from the Mozambique Revenue Authority shared their interesting experience on how to invite the informal
trade sector to become part of the formal trade sector by offering special tax incentives and a tax
number. In this area, cooperation with tax administrations and other government agencies is
indispensable. How to address the informal trade sector is one of the issues that the WCO wishes to
continue to explore.
Finally, capacity building is key to modernization for revenue organizations. We heard a very interesting
presentation from Maria Elena Botero from Colombia Customs about the use of information technology to
facilitate exchange of information between Customs and tax. We also heard about the Estonian Customs
and Tax unified IT system. We would like to see these kinds of systems that enhance the exchange of
information between Customs and tax authorities, supported by advanced information technology.
Christian Saborowski from the World Bank demonstrated its tool TRIST to forecast the impact of tariff
reforms on trade. Together with the presentation by Bryane Michael, they showed the power of data.
In conclusion, I would like to thank all of you for making this Conference a great success. I would also
like to thank the speakers and moderators for the expertise they have shared with us. Last but not least,
I would like to thank the audience, who not only asked excellent questions, but shared insightful
comments. Your energy is greatly appreciated. All presentations and the background paper as well as a
summary of this Conference will be loaded on our website to share this information, not only with
participants, but also with others including our 176 Members, and our partners.
Finally, I would like to thank my friend and colleague Chriticles Mwansa from the Zambia Revenue
Authority for chairing the event. Your leadership during this Conference has proved a great asset, and I
really appreciate your contribution. I wish all a safe trip back home.
Thank you.

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Closing remarks by Kunio Mikuriya

Ladies and Gentlemen,

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