Does the Organizational Structure of Tax Administration Really Matter for Tax Collection?

This paper is aimed at investigating whether changing the structural designs of the organization of a tax administration is a reliable strategy toward improving domestic revenue mobilization capacity. Using the Indonesian tax administration as case study, the answer to this research objective was approached empirically by employing the interrupted time-series analysis on data related to the dynamics of the tax administration’s organizational structures and tax collection performance covering the period from 1984 to 2019. The investigation found that changes in the organizational structure of the tax administration do not seem to exert a positive and robust impact on collection performance. These changes have been found to be ineffective in reversing the persistent decline in tax revenue. Hence this paper suggests that, at least in the case of Indonesia, the organizational structure of a tax administration might not matter for tax collection