Taxfix – Between the People and the State by Alexander Gornyi


The post was originally published in Russian on Startup of the Day. Alexander kindly agreed to republish what we think is of great value to our readers.

A regular person fears any interaction with bureaucracy, but the business can help them out. Taxfix, the German startup of the day, developed a service for simplified filling-out of tax declarations. Here’s how it works: the user signs up, takes 20 minutes to answer the chat bot’s questions, encloses the necessary documents with the help of the smart recognition, – and Taxfix automatically sends the request to the tax office.

The transfer of the documents costs 40 Euros, the service only charges for the final step, one can click through all the forms for free. The price compares to a couple of hours of a regular German’s work, it makes perfect sense to pay them because one can hardly fill out all the papers manually, besides there’s a chance of error.

The startup is doing well: millions of clients, USD 330M of investments, and the valuation of 1B upon the most recent round. The only boggling question here is – why do people even need it? Why can’t the German tax administration program a user-friendly interface for accepting documents. The private initiative will understandably win in some complicated competitive spheres, – but what’s the deal here?

It’s easy to replace it. How many people does Taxfix have in its product development team? 30? 50? 100? It is impossible to hire as many and produce something equally pretty-looking and easy to use? Today, the startup works as a hidden tax for the state’s bungling – and, looking at the valuation of USD 1B, the law is quite significant. There is another tax – for the time and error of those who don’t use Taxfix. Why can’t these taxes be canceled? Dozens of millions of dollars and human hours would be spent on something useful, the country would benefit from it.

Naturally, this is not an exclusively German problem, there is an unwritten law saying that ‘the state cannot do things normally’ almost everywhere around the world. I’d like another globe please.

Translation: Kostiantyn Tupikov


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