zkTax: A pragmatic way to support zero-knowledge tax disclosures

Fuente: arXiv
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Hauptverfasser: Berke, Alex, South, Tobin, Mahari, Robert, Larson, Kent, Pentland, Alex
Format: Preprint
Veröffentlicht: 2023
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author Berke, Alex
South, Tobin
Mahari, Robert
Larson, Kent
Pentland, Alex
author_facet Berke, Alex
South, Tobin
Mahari, Robert
Larson, Kent
Pentland, Alex
contents Tax returns contain key financial information of interest to third parties: public officials are asked to share financial data for transparency, companies seek to assess the financial status of business partners, and individuals need to prove their income to landlords or to receive benefits. Tax returns also contain sensitive data such that sharing them in their entirety undermines privacy. We introduce a zero-knowledge tax disclosure system (zkTax) that allows individuals and organizations to make provable claims about select information in their tax returns without revealing additional information, which can be independently verified by third parties. The system consists of three distinct services that can be distributed: a tax authority provides tax documents signed with a public key; a Redact & Prove Service enables users to produce a redacted version of the tax documents with a zero-knowledge proof attesting the provenance of the redacted data; a Verify Service enables anyone to verify the proof. We implement a prototype with a user interface, compatible with U.S. tax forms, and demonstrate how this design could be implemented with minimal changes to existing tax infrastructure. Our system is designed to be extensible to other contexts and jurisdictions. This work provides a practical example of how distributed tools leveraging cryptography can enhance existing government or financial infrastructures, providing immediate transparency alongside privacy without system overhauls.
format Preprint
id arxiv_https___arxiv_org_abs_2311_13008
institution arXiv
publishDate 2023
record_format arxiv
spellingShingle zkTax: A pragmatic way to support zero-knowledge tax disclosures
Berke, Alex
South, Tobin
Mahari, Robert
Larson, Kent
Pentland, Alex
Cryptography and Security
Tax returns contain key financial information of interest to third parties: public officials are asked to share financial data for transparency, companies seek to assess the financial status of business partners, and individuals need to prove their income to landlords or to receive benefits. Tax returns also contain sensitive data such that sharing them in their entirety undermines privacy. We introduce a zero-knowledge tax disclosure system (zkTax) that allows individuals and organizations to make provable claims about select information in their tax returns without revealing additional information, which can be independently verified by third parties. The system consists of three distinct services that can be distributed: a tax authority provides tax documents signed with a public key; a Redact & Prove Service enables users to produce a redacted version of the tax documents with a zero-knowledge proof attesting the provenance of the redacted data; a Verify Service enables anyone to verify the proof. We implement a prototype with a user interface, compatible with U.S. tax forms, and demonstrate how this design could be implemented with minimal changes to existing tax infrastructure. Our system is designed to be extensible to other contexts and jurisdictions. This work provides a practical example of how distributed tools leveraging cryptography can enhance existing government or financial infrastructures, providing immediate transparency alongside privacy without system overhauls.
title zkTax: A pragmatic way to support zero-knowledge tax disclosures
topic Cryptography and Security
url https://arxiv.org/abs/2311.13008