The Ministry of Finance (MOF) was the first to set up the Fiscal and Taxation Data Processing and Assessment Center. However, in an era when few people were familiar with computer operations and automation concepts, the pioneers obviously needed not only courage, but also patience and perseverance to overcome all kinds of problems and challenges.
Dr. Liu Dazhong, a well-known economist in the United States, learned lessons from the experience that the United States had already started to use computers to handle various tax administrations at that time, and hoped to set up a “Data Processing Center”. Such a novel proposal was met with strong opposition at the time. However, President Chiang Kai-shek personally instructed that “every instruction should be followed”. Thus, the preparatory work started smoothly in May 1968 and the Center was officially named “Fiscal and Taxation Data Processing and Assessment Center”.
In the process of preparing the “Fiscal and Taxation Data Processing and Assessment Center”, Dr. Liu invited Monroe Berg, a system analyst at the Internal Revenue Service (IRS) of the U.S. Department of the Treasury, as a consultant. In addition to assisting in the research and development of the use of electronic computers to deal with tax refunds and individual income tax related matters for export products, one of the most important tasks was to determine the computer equipment to be used in the Center. After 6 months of tax data analysis, system planning, and program design, program testing was carried out in late December, and it was finally decided that a CDC3300 electronic computer would be leased from the United States.
On January 21, 1969, Vice President Yen Chia-kan personally presided over the official opening ceremony of the CDC3300 electronic computer, which ushered in the use of computers by the central ministry and entered a new era of informatization. At that time, the memory storage capacity of this mainframe was 32K. Attached are 6 tape drives, 5 disk drives, a card reader, a clock-in machine, and a printer. In addition, a program processor and a printer are installed to expand the memory storage capacity to 65K. Such a configuration would seem to be unbelievably meager compared with a personal computer PC today, but at that time, it was one of the electronic computers with the largest computing power in Southeast Asia.
The Fiscal and Tax Data and Assessment Center analyzes a large number of tax-related data with complex content, and divides various data into three major items: taxpayer basic data, declaration data, and survey data. Basic taxpayer data includes household information, land data, and industrial and commercial registration information, etc.; declaration data is the information reported by the taxpayer to the taxation authority in accordance with the laws and regulations. Survey data is the information that the taxation authority collects through its own investigation. Through computer processing, functions such as modifying data, connecting data to designated accounts, and cross-inquiry can be achieved, improving the efficiency of tax collection and reducing errors and abuses. In order to familiarze the public and tax officials with the concept of tax administration automation as early as possible and shorten the time for policy promotion, the Tax Reform Commission decided to officially digitize all individual income tax in 1968.
There were a total of 8 million withholding tax statements that year, of which 40% were missing the national ID card number, and another 30% had incomplete data.
Because the personal income tax is based on the national ID card number issued in 1965, many numbers were issued multiple times or in error. Although the Fiscal and Taxation Data Processing and Assessment Center was not in charge of the national ID card, they had to bear the brunt of the criticism. Aware of the immense pressure, Dr. Liu cheered on staff members and believed that they would persevere and overcome all difficulties.
At the beginning of 1970, the Fiscal and Taxation Data Processing and Assessment Center was able to overcome all difficulties and completed nearly 7.9 million withholding tax statements, 930,000 non-withholding documents, and nearly 1.49 million individual income tax settlement declarations, etc., and established the capacity to handle large volumes of data.
In order to deal with profit-seeking enterprise income tax, the Tax Reform Commission cooperated with the Fiscal and Taxation Data Processing and Assessment Center to compile tax ID numbers of withholding and withholding agents for profit-making enterprises in Taiwan, unified the industry classification code of Taiwan, and created taxpayer identification profiles of profit-seeking enterprises.
Tax collection is built on the foundation of accurate household registration information. In January 1970, the Tax Reform Commission invited the Ministry of the Interior; Directorate General of Budget, Accounting and Statistics, Executive Yuan; Council for Economic Planning and Development, Executive Yuan; and other agencies to set up a task force for establishing household registration files of Taiwan by using computers. Measures such as adding a column for the national ID card number in the household certificate greatly improved the accuracy of household registration information.
After that, related problems were gradually solved, and the tax collection agency was finally able to use computers to operate on a large scale. Since then, the Fiscal and Taxation Data Processing and Assessment Center has established comprehensive archives, making the data processing more accurate and generally gaining the trust of taxpayers.
Five years after the official establishment of the Fiscal and Taxation Data Processing and Assessment Center, Al-Ahel, the Minister of Finance of the Kingdom of Saudi Arabia, with whom Taiwan had diplomatic relations at the time, was so deeply impressed by the operational efficiency of the center that he invited the former directors of the Center, Lu Runkang and Shen Pe-ling, to go to Saudi Arabia to guide the operation of their computer center.
In May 1987, the MOF substantially revised the Organic Act, formally incorporating the Fiscal and Taxation Data Processing and Assessment Center into the central government organization, renamed it the Fiscal Information Agency (FIA), and empowered it to be responsible for information management of the MOF.