DigiD overload this week meant that many people were unable to log in to the Tax and Customs Administration to file their tax returns. This is not the fault of the tax authorities, but it is reminiscent of the ICT problems that the government has been struggling with for years. These are caused by outdated systems and their renewal can take up to three years.
People born in the year that the Tax and Customs Administration experienced IT problems that continue to this day will come of age this year. In 2005, then State Secretary for Economic Affairs Joop Wijn decided that the tax authorities should be given more tasks. Collecting taxes was no longer his only task, this also included paying benefits.
The intention was to make payouts more efficient. But it soon became apparent that the Tax and Customs Administration’s systems might not handle the checking of all data. Tens of thousands of people received their money too late as a result.
A few years later, Jan Kees de Jager took over the Tax and Customs Administration. In 2008 it turned out that 730,000 digitally completed declarations had disappeared. This was also due to problems with the ICT systems of the Tax and Customs Administration. A reorganization of the ICT department followed, but that was not the solution.
And last year the government was unable to mitigate the consequences of the unprecedented inflation by releasing extra money. This was because the Tax and Customs Administration’s computer systems did not want to cooperate.
Programming language used by the Tax and Customs Administration is dying out
Some of the systems are quite outdated. The Court of Audit already wrote in 2019 that half of the Tax and Customs Administration’s systems were no longer up to date. For example, it is known that the sales tax is still processed with a system from 1982. A number of programs are written in old programming languages that are hardly used anymore.
The same is now happening with COOL:Gen, a programming language that is intertwined with the systems of the Tax and Customs Administration. The language dates back to the eighties, but the knowledge of COOL:Gen is dying out. Therefore, the system must be replaced. And that is a lot of work.
Moreover, the Tax and Customs Administration’s systems have been expanded over the years. This created a patchwork of applications that were tied together. “More and more is being asked of a system, which leads to higher pressure on the executive parties,” said former D66 MP Kees Verhoeven earlier. “Eventually you run into limits.”
No policy changes possible in the coming years
If all goes well now, the phase-out of COOL:Gen should be completed in 2026. The project has already been postponed by a year due to a ruling by the Supreme Court. As a result, the wealth tax in box 3 had to be adjusted urgently.
Due to persistent ICT problems at the Tax and Customs Administration, no new policy changes are possible during this government’s term of office. State Secretary Marnix van Rij (Tax and Tax Administration) wrote this in a letter to Parliament last month.
For the first time there is also a so-called Long-Term Portfolio. The planning for the period from 2023 to May 2027 states which problems must be tackled and when.
Several applications have been modernized in the past five years
But work has already been done, according to Van Rij’s letter to Parliament. Since 2018, the technical debt of the tax authorities has been reduced by half. This refers to ICT that is outdated and cannot be easily adapted.
The debt in Tax and Customs Administration applications has been reduced from 52 percent to 26 percent in 2022. In total, the Tax and Customs Administration’s ICT consists of nine hundred applications that are partly linked to each other.