  The latest advancements in Distributed Ledger Technology (DLT), and payment
architectures such as the UK's New Payments Architecture, present opportunities
for leveraging the hidden informational value and intelligence within payments.
In this paper, we present Smart Money, an infrastructure capability for a
Central Bank Digital Currency (CBDC) which enables real-time Value Added Tax
split payments, oversight, controlled access and smart policy implementation.
This capability is implemented as a prototype, called Making Tax Smart (MTS),
which is based on the open source R3 Corda framework. The results presented
herein confirm that it is feasible to build a MTS capability which is scalable
and co-exists with the current payment systems. Smart Money CBDC has the
potential to mobilise payments data in order to transform the role of money
from a blunt instrument to a government policy sensor and actuator without
disrupting the existing money system. DLT, smart contracts and programmable
money have a crucial role to play with benefits for government departments, the
economy and society as a whole.
