Tax digitisation according to KONSENS with adesso

How do you actually manage over 50 million taxpayers?

For understanding and introduction: Tax digitisation does not only affect employees at the tax office, it affects every citizen of the country who pays taxes. And while some people may tune out at the mention of ‘taxes,’ we should take a closer look at the progress being made in the digitisation of tax procedures. Without tax procedures, the state would be insolvent within a matter of days, as taxes are the country's largest source of revenue. They make a fundamental contribution to value creation and maintenance.

In my blog post, I would like to establish a common understanding of tax digitisation.

Digitising taxes according to tax language

There are a few terms you should know when it comes to tax digitisation.

KONSENS Act

The KONSENS (Coordinated New Software Development for Tax Administration) Act regulates the uniform development and joint use of software in tax administration by the federal states. The KONSENS Act came into force in August 2017.

The federal states are working together on the planning, development, maintenance and use of tax procedures within the framework of an administrative agreement.

The aim is to make tax procedures more efficient and to ensure a media-break-free, uniform IT infrastructure. KONSENS creates the basis for the federal states to work actively together, leading to more standards and mutual understanding. This saves costs, time and reduces administrative effort.

And yes, of course, IT procedures were already being digitised before 2017. Thanks to the KONSENS Act, this is now happening in a more centralised, focused and, above all, cross-state manner.

KONSENS project

The KONSENS project is a cross-state and cross-federal initiative for the joint development and use of uniform IT procedures for tax administration.

The aim is to modernise and digitise tax enforcement nationwide. This avoids redundancies in development, tax waste and ensures that thinking and development are cross-state.

KONSENS procedures

16 federal states, including five contractors, and the federal government are working together on a total of 19 IT procedures with well over 1,300 employees. The focus is no longer on development within individual federal states, but on a uniform, Germany-wide approach. This saves money, processes and time.

Five client states (Baden-Württemberg, Bavaria, Hesse, Lower Saxony and North Rhine-Westphalia) are working with the federal government on Germany's largest digitisation project according to the EfA principle (one software for all). The costs are shared by all federal states and the federal government.

ELSTER, Germany's largest e-government application, is certainly familiar to everyone. But what would ELSTER be without the IT procedure GINSTER, the basic information service of the tax administration? This is where the master data of taxpayers is stored, which ELSTER accesses for each tax case.

Another IT procedure called BIENE maintains the master data and keeps it up to date. GINSTER is informed of any changes to the master data via BIENE.

If a tax return is sent to a taxpayer via ELSTER, how much would it cost the state if one in a hundred tax returns resulted in incorrect taxation? Not only the correction work would have to be taken into account, but also any appeals that taxpayers might lodge.

The many millions of tax returns submitted each year are difficult to check manually. This is where RMS comes in as a risk management system. RMS checks and evaluates the correct taxation, in some cases fully automatically, depending on the tax case.

There are 19 IT procedures that communicate with each other – across federal states, of course – and some of which are interdependent.

How do you ensure that all procedures work on current data and can make the right decisions based on this?

GeCo coordinates cross-procedural business processes, preventing data bottlenecks, misinformation and delays in communication between procedures. This provides the tax office clerk with a robust and reliable system. The result? A smooth process between the tax office and you as a taxpayer.

TZAK2025v2

TZAK2025v2 (Technical Target Architecture Consensus) supplements the processes, laws and cross-cutting projects for joint cooperation between the federal states with technical specifications. As a result, the tax administration is moving away from a monolithic approach in the medium to long term and is focusing on modern technologies such as microservices.

To make this clearer for those involved, a technology stack has been developed that specifies standards for security and compliance, for the development of specialist procedures in microservices according to client, backend and database, for DevOps, for the necessary infrastructure software and for integration (messaging, process integration and API gateway). In addition, there is the KONSENS AppKit, which can be understood as an app framework. TZAK2025v2 supports the tax administration's cloud strategy and enables seamless integration into the German Administration Cloud (DVC).

Challenges in the digitalisation of tax administration

The challenges are not so different from those we already face in public administration.

Shortage of personnel/skilled workers

Tax administration must also face demographic change. Added to this is the need for skilled personnel who are familiar with both IT and the complex technicalities of tax administration.

Lack of know-how

New technologies and methods require not only a willingness to learn, but also specific expertise, some of which must first be built up internally.

Feasibility of the KONSENS requirements

KONSENS is taking the right steps, but new requirements and working methods are a major change project. People need to be taken along with the process, and that cannot happen overnight.

Consolidation of processes, IT landscapes and procedures

TZAK2025v2 shows how things should be. However, development is not taking place on a greenfield site, and the tax system is complex, as is the current IT landscape.

Operation of the modern target architecture

Nowadays, a business must be able to understand modern architecture and work with the latest technologies and components. It is not enough to simply provide servers and space. Businesses must collaborate with other state-owned companies, undergo BSI certification, ensure high availability and, in addition to regular operations, find time for the many new projects and their implementation.

Use of AI in the context of data protection

AI is already helping in tax administration, albeit not yet to its full extent. Employees must be trained in its use and the solutions should be provided in compliance with data protection regulations.

Many of these challenges go beyond the wishes and plans of the digitised tax administration:

• Working more cost-efficiently,
• Delivering software more regularly,
• Providing legally compliant software,
• Becoming more paperless, Less media discontinuity,
• providing software closer to the user, and
• actively integrating and using modern technologies such as AI.

Our services

adesso has been actively involved in the digitisation of tax administration for over ten years and successfully supports a wide range of specialist areas in countless roles.

Our experts have comprehensive expertise and established standards. We are technological pioneers and have expertise in every component of TZAK2025v2 as well as other topics.

As an AI service provider, we combine technical know-how with a deep understanding of the specific subject matter.

At a glance – adesso:

• is among the top 5 digitalisation partners in Europe.
• has project expertise from 16 KONSENS IT procedures.
• is a digitalisation partner for financial processes and taxes.
• is a public sector expert with over 500 employees who help digitise public administration.
• is an SAS partner: as a leading SAS partner, we use the Financial Crime Platform to detect tax fraud.
• is an SAP Gold Partner with over 1,000 experts.
• has tax references in North Rhine-Westphalia, Bavaria and Hesse.

We also rely on in-house developments such as:

• adesso Transformer: With the adesso transformer suite, we transfer your business logic to a new application architecture. Code must be readable, maintainable and refactorizable so that operation and maintenance can then take place in a containerised environment. We combine all this in one product.
• Echolot as a GDPR-compliant survey tool
• adessoGPT, our data protection-compliant AI solution for maximum efficiency and security from a single source.