Business transformation project sees costs soar by $420,000 as tax staff fly around world.

The tax department's international travel bill has ballooned by more than $420,000 in a single year - an increase of 38 per cent.

Inland Revenue staff and contractors visited Fiji, France, Austria, Hungary, Finland, Norway, Sweden, the United Kingdom, the United States, Canada, China, India, Malaysia, Singapore, the Solomon Islands, South Korea and Vietnam.

Fifty-four separate trips were made to Australia.

The department says the costs are related to a major project that will transform its business and overhaul its 30-year-old information technology system.

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The projected overall cost of its business transformation project has dropped significantly, but it has necessitated trips such as when, in March, external consultants were flown to Australia and Singapore at a cost of $113,000.

Managers and staff working on the project have also been flown to the US, Australia and Singapore.

The department spent $1.551 million on international travel in the last financial year - a jump from the $1.125 million spent in 2013/14.

Just over $671,000 of last year's spend was on travel and accommodation relating to the transformation project.

Other travel, not related to the transformation project, included meeting counterparts from the OECD in France, and attending workshops in Singapore and other countries.

One of the more expensive trips, at almost $25,000, was for one manager to travel to France and India to speak at the Congress of International Fiscal Association, and attend a UN committee.

An IRD spokesman said all overseas travel costs were budgeted for, and were carefully monitored to ensure they were appropriate - including paying economy fares for flights shorter than 9 hours, booking well in advance, and considering alternatives such as video conferencing.

The huge scale of the transformation project has attracted attention, with initial estimates predicting a cost of between $1.3 billion and $1.9 billion over eight to 10 years.

In November, then Revenue Minister Todd McClay said the programme was likely to take less time than originally projected, and cost less than $1 billion.

The revised cost was partly due to Colorado-based Fast Enterprises' off-the-shelf software, which was already used in other countries. Fast Enterprises is the preferred software provider and will deliver close to 90 per cent of the project core services.

The IRD spokesman said the travel bill included travel related to software selection.

Labour's revenue spokesman Stuart Nash said he hoped the IRD had made full use of technology such as Skype before signing off travel.