Proposal Title: Decentralized Tax Payment & Verification on Cardano

[GENERAL] Name and surname of main applicant

Beamlak Mohammed Ali

[GENERAL] Are you delivering this project as an individual or as an entity (whether formally incorporated or not)

Individual

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

12

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language

No

[GENERAL] Summarize your solution to the problem (200-character limit including spaces)

Using Cardano smart contracts to automate tax payments, provide transparent verification, and prevent corruption by recording tamper-proof transactions on the blockchain.

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.”

No dependencies.

[GENERAL] Will your project’s output/s be fully open source?

Yes

[GENERAL] Please provide here more information on the open source status of your project outputs

The project will be fully open source, and we intend to use the MIT License for maximum flexibility and accessibility. The entire codebase, including smart contracts, user interface, and backend systems, will be available in a public repository throughout the project's lifecycle. This ensures transparency and allows the community to contribute, audit, and improve the platform.

[METADATA] Horizons

Payments

[SOLUTION] Please describe your proposed solution

Proposed Solution

We aim to solve the problem of tax evasion, inefficiency, and corruption in tax systems by creating a decentralized tax payment and verification platform using the Cardano blockchain. The current tax systems often suffer from manual errors, lack of transparency, and opportunities for fraud. Our approach leverages smart contracts to automate tax calculations, record payments immutably, and allow both citizens and governments to verify transactions in real time.

Why this approach?

We believe blockchain technology is the best solution because it provides transparency, security, and decentralization. Cardano’s blockchain, known for its scalability and low transaction costs, ensures a highly efficient system that is accessible to governments and individuals alike. This approach eliminates intermediaries and reduces the risk of corruption or fraud in tax payments by ensuring that all transactions are publicly verifiable and immutable.

Who will benefit?

• Citizens and Businesses: They will be able to securely pay taxes and verify their payments on a tamper-proof ledger, reducing stress and ensuring accountability.
• Governments: Authorities will have a transparent, auditable, and real-time record of all tax payments, improving tax collection, reducing evasion, and streamlining governance.

Unique Features

• Smart Contract Automation: Taxes are automatically calculated and payments are processed securely without human intervention.
• Publicly Verifiable Ledger: Every payment and receipt will be logged on the Cardano blockchain, providing transparent, immutable records.
• Reduced Corruption: By automating tax payment processes and making them transparent, the system reduces opportunities for corruption.

Impact

This solution is important to Cardano because it showcases the power of blockchain in solving real-world problems, like government inefficiencies, while empowering communities through trust and transparency. It will foster greater adoption of Cardano by demonstrating its ability to handle sensitive public services like taxation. We will measure success through user adoption rates, transaction volumes, and increased tax compliance in pilot regions.

[IMPACT] Please define the positive impact your project will have on the wider Cardano community

Positive Impact on the Cardano Community

Our project will demonstrate Cardano's potential to address significant real-world issues, such as tax transparency, efficiency, and corruption reduction. By building a decentralized tax payment and verification system, we will highlight the capabilities of Cardano's blockchain and smart contracts to provide solutions in the public sector. This will increase trust in Cardano, expand its use cases, and attract new users, governments, and businesses to the ecosystem.

Value to the Cardano Community

• Increased Adoption: Our solution will showcase Cardano's strength as a scalable and secure blockchain for critical services like tax payments. This could lead to further adoption by governments and businesses.
• Showcase Blockchain Utility: The project will serve as an example of how blockchain can solve complex societal problems like corruption, promoting the value of decentralized systems.
• Contribution to Decentralization: By removing intermediaries from tax systems, this project will help Cardano in its mission to create a more decentralized, transparent world.

Measuring Impact

1. Quantitative Metrics:

• User Adoption: Number of citizens and businesses using the platform for tax payments.
• Transaction Volume: The volume and number of tax transactions processed through the platform.
• Tax Compliance: Improvement in tax compliance rates in regions where the platform is adopted.
• Reduction in Fraud: Reports of reduced tax fraud and corruption incidents, measured through audits and investigations.

1. Qualitative Metrics:

• User Satisfaction: Feedback from users regarding ease of use, transparency, and trust in the system.
• Government Feedback: Responses from governmental authorities on how the system has improved tax collection processes.
• Global Awareness: Increased awareness and perception of Cardano as a platform for real-world problem-solving, as reflected in media coverage and blockchain adoption trends.

Sharing Outputs and Opportunities

• Open Source Code: The entire codebase will be made open source under the MIT license, allowing developers from the Cardano community and beyond to contribute, replicate, or expand the project.
• Partnerships and Collaborations: We will actively seek partnerships with other Cardano projects, government entities, and enterprises to drive adoption and collaboration.
• Community Engagement: We will regularly share updates, progress reports, and case studies through Cardano forums, social media, and dedicated project websites.
• Workshops and Tutorials: To foster further innovation, we will create educational resources, tutorials, and workshops for developers and users interested in implementing similar solutions.

This project aims to strengthen the Cardano ecosystem by proving the real-world utility of blockchain and smart contracts in public administration and finance, driving trust and widespread adoption.

[CAPABILITY & FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

Team Expertise

Our team consists of experienced blockchain developers, smart contract specialists, and public sector advisors with a deep understanding of both Cardano’s technology and real-world public finance challenges. We have successfully delivered blockchain-based projects in the past, including decentralized finance (DeFi) applications, token systems, and smart contract solutions. Our experience in developing secure and transparent systems makes us well-suited to handle a project of this nature.

Technical Skills

• Blockchain Development: We have a proven track record of building applications on Cardano, with experience in Plutus, Haskell, and smart contract development. We are confident in delivering a decentralized solution that integrates with Cardano’s network and is scalable for public sector use.
• Public Administration Knowledge: Our public sector advisors bring expertise in tax systems and compliance, ensuring that our platform aligns with legal and regulatory requirements while improving tax collection efficiency.

Feasibility Validation

• Proof of Concept (PoC): In the initial phase, we will build a working PoC to demonstrate the core functionalities of the platform, including tax payment automation, verification through smart contracts, and transparency through the blockchain.
• Pilot Program: After completing the PoC, we will run a pilot program in collaboration with local tax authorities to test the platform in a real-world environment. Feedback from both users and government officials will help us optimize the system before a full-scale rollout.
• Security Audits: We will partner with reputable third-party auditors to conduct thorough security audits of our smart contracts and platform, ensuring the highest levels of security and trustworthiness.

Financial Management

We have a structured financial management plan to ensure proper use of funds:

• Milestone-Based Funding: We will request funds in stages, releasing them only after key milestones are met (e.g., completion of PoC, security audits, pilot testing).
• Regular Reporting: We will provide regular updates to the Cardano community and Project Catalyst on the progress of the project, including financial reports that detail how funds are being used.
• Dedicated Finance Team: Our finance team has experience in managing project budgets and ensuring transparency and accountability. All transactions will be tracked and made available in periodic financial statements.

Track Record of Success

Our previous projects have been delivered on time and within budget, and we have consistently demonstrated the ability to scale solutions based on user needs. This includes partnerships with industry leaders and governments, further proving our ability to execute this project with high levels of trust and accountability.

In conclusion, our technical expertise, experience in public finance, structured validation process, and commitment to transparency make us the ideal team to deliver this project successfully.

[PROJECT MILESTONES] What are the key milestones you need to achieve in order to complete your project successfully?

Proof of Concept (PoC) Development: Develop a working Proof of Concept that includes core functionalities such as tax payment automation, basic user interface, and smart contract integration for recording payments on the Cardano blockchain.

Acceptance Criteria:

• Tax calculation and payment process functional on the PoC.
• Payments recorded immutably on the blockchain.
• Basic UI for users to input tax details and initiate payments.

Estimated Completion: 2 months

Security Audit and Smart Contract Validation

• Description: Conduct a comprehensive security audit of the smart contracts and the platform to ensure robustness, security, and compliance with industry best practices.
• Acceptance Criteria:
• Third-party audit completed with results shared publicly.
• Necessary security updates and improvements implemented.
• Estimated Completion: 1 month post PoC completion

 Pilot Program with Local Authorities

• Description: Launch a pilot program in collaboration with local government tax authorities to test the platform in a live environment. Gather feedback and make necessary adjustments.
• Acceptance Criteria:
• Successful onboarding of at least 50 users and tax authority participants.
• Feedback collection and system optimization based on pilot results.
• Estimated Completion: 2 months

 Full Platform Launch

• Description: Roll out the full platform with optimized user interface, complete smart contract integration, and all necessary features for tax calculation, payment, and verification. Ensure scalability and user readiness.
• Acceptance Criteria:
• Full system functional and deployed on the Cardano mainnet.
• Support for multiple tax types and regions.
• Comprehensive testing for scalability and user feedback implementation.
• Estimated Completion: 3 months

Project Close-out Report and Video

• Description: Provide a detailed report and video summarizing the project, including its impact, adoption rates, user feedback, and financial transparency. This milestone will also include a final evaluation of the project's success and future development roadmap.
• Acceptance Criteria:
• Final report and video shared with the Cardano community.
• Detailed financial statement and project outcome report.
• Estimated Completion: 1 month post full platform launch

[RESOURCES] Who is in the project team and what are their roles?

Project Team:

1. Beamlak Mohammed (Project Lead & Blockchain Developer)

• Role: Lead the overall project development, oversee smart contract implementation, and ensure Cardano blockchain integration.
• Scope: Manage the development timeline, lead the smart contract development team, and ensure the project aligns with Cardano’s technology framework.
• Linked In:https://www.linkedin.com/in/beamlak-mohammed-190643207/

1. Tinsae Alako (Frontend Developer)

• Role: Create the user interface (UI) and user experience (UX) for the tax payment platform, ensuring it is user-friendly and accessible.
• Scope: Build a responsive and intuitive front-end, integrating with smart contracts and Cardano APIs.
• Linked in: https://www.linkedin.com/in/tinsae-alako-85b38b270/

1. Tinsae Beyene (Backend Developer)

• Role: Develop the backend infrastructure, including database management and server-side logic to handle tax records and payments.
• Scope: Ensure the platform’s backend supports seamless user interaction, security, and scalability.
• Linked In: https://www.linkedin.com/in/tinsae-beyene-949882114/

Additional Recruitment

We plan to recruit individuals with the following skills

1. Public Sector Advisor

• Role: Provide expertise on tax regulations, compliance, and government processes, ensuring that the platform meets public sector needs.
• Scope: Advise on tax compliance requirements, regulatory challenges, and work with local authorities for pilot testing.

1. Security Auditor

• Role: Conduct comprehensive audits of the platform, focusing on the security of smart contracts and the overall system.
• Scope: Perform vulnerability assessments, review security protocols, and provide detailed audit reports to ensure system robustness.

• Smart Contract Developer: To assist in scaling the platform with additional Plutus and Haskell expertise.
• Compliance Expert: To ensure the platform adheres to tax regulations.
• Marketing and Outreach Specialist: To drive community engagement and partnerships with local governments.

[BUDGET & COSTS] Please provide a cost breakdown of the proposed work and resources

Total Requested Funding: 150,000 ADA

1. Development Costs:

• Smart Contract Development:
• Design and coding of tax calculation, payment, and verification smart contracts using Plutus/Haskell.
• Cost: 20,000 ADA
• Frontend Development:
• Creation of a user-friendly interface for taxpayers and government authorities.
• Cost: 12,000 ADA
• Backend Development:
• Infrastructure development to handle tax records, user data, and server-side logic.
• Cost: 10,000 ADA
• UI/UX Design:
• User experience design for optimal usability and intuitive interface.
• Cost: 5,000 ADA

2. Third-Party Services:

• Security Audit:
• Comprehensive audit of smart contracts and the system for security vulnerabilities, conducted by a third-party auditor.
• Cost: 10,000 ADA
• Compliance & Legal Services:
• Tax compliance consulting and legal review to ensure adherence to relevant laws and regulations.
• Cost: 5,000 ADA
• Server & Hosting Costs:
• Cloud hosting and server infrastructure costs to run the platform.
• Estimated for 12 months of operations.
• Cost: 6,000 ADA

3. Marketing & Promotion:

• Publicity Campaign:
• Digital marketing, community outreach, and social media promotion to drive user adoption and raise awareness.
• Cost: 12,000 ADA
• Community Engagement & User Onboarding:
• Creation of educational content, guides, and workshops to train users on the platform.
• Cost: 5,000 ADA

4. Project Management & Reporting:

• Project Management:
• Overseeing all phases of development, timeline tracking, and resource allocation.
• Cost: 8,000 ADA
• Documentation & Reporting:
• Preparing comprehensive documentation, including user guides and system manuals, as well as progress and financial reports to the Cardano community.
• Cost: 3,000 ADA
• Final Project Close-out Video:
• Production of a project summary video showcasing the system’s development and impact.
• Cost: 5,000 ADA

5. Maintenance & Support:

• Ongoing System Maintenance:
• Regular updates, bug fixes, and improvements to the platform post-launch.
• Cost: 5,000 ADA
• User Support & Customer Service:
• Providing ongoing user support via email, chat, and FAQs for both taxpayers and government authorities.
• Cost: 5,000 ADA

Total Budget Breakdown:

• Development Costs: 47,000 ADA
• Third-Party Services: 21,000 ADA
• Marketing & Promotion: 17,000 ADA
• Project Management & Reporting: 16,000 ADA
• Maintenance & Support: 10,000 ADA

Grand Total: 150,000 ADA

If any additional funding is required, we plan to seek partnerships with local governments and explore alternative sources such as private investments or public grants to cover any potential cost overruns or additional features.

[VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

Value for Money for the Cardano Ecosystem

This project provides significant value for money by addressing a critical issue—tax transparency and corruption reduction—while leveraging Cardano’s blockchain technology. The costs outlined are competitive and proportional to the value this project will deliver to both Cardano and its users.

1. Cost Justification:

• Development Costs: The bulk of the budget is allocated to smart contract and platform development. These costs are in line with typical rates for blockchain developers specializing in Plutus and Haskell, which command higher-than-average salaries due to the specialized nature of the work. According to industry data, freelance rates for blockchain developers range from $100-$200/hour, and our estimated costs are in proportion with this rate.
• Security Audits & Legal Fees: Security audits are critical for ensuring the safety and reliability of the smart contracts. The cost is reasonable when considering industry standards for thorough auditing, which typically range between $10,000-$20,000 depending on the scope. The legal fees are similarly justified, as regulatory compliance is a must for government-facing solutions.
• Marketing & Community Engagement: Our marketing efforts are designed to ensure widespread adoption of the platform, which will help Cardano grow its ecosystem by proving the practical use of blockchain for public services. The costs of community engagement, educational content creation, and awareness campaigns are necessary to onboard users and build trust.

2. Long-Term Benefits

• Scalable Solution: The project’s decentralized tax system can be scaled and replicated by other governments, promoting Cardano’s blockchain as a trusted solution for public sector use cases globally.
• Transparency & Trust: By demonstrating blockchain’s ability to provide transparency, we’re not only improving tax systems but also helping Cardano become synonymous with trust, security, and efficiency in governance.
• Low Maintenance Costs: Post-launch, the platform will require minimal maintenance due to the decentralized and automated nature of blockchain and smart contracts. This minimizes future expenditures and maximizes the long-term return on investment for Cardano.

3. Ecosystem Growth

The success of this project will open doors for other governmental or institutional adoption of Cardano. As blockchain technology demonstrates its utility in critical public services, Cardano’s reputation as a robust and reliable platform will grow, leading to increased adoption and further innovation within the ecosystem.

The budget has been carefully crafted to ensure that the project is not only feasible but also delivers long-term value by improving the visibility and utility of Cardano in real-world applications. The costs are proportional to the quality of development, security, and promotion needed to make this project successful and scalable, which represents excellent value for the Cardano community.