This position fulfils an announcement made by the Prime Minister as part of the ‘Securing Australia’s Prosperity’ policy document in 2001:
‘As a separate and distinct initiative, in a third term, the Coalition will strengthen the advice given to government in respect to matters of tax administration and process through the creation of a senior office, the Inspector-General of Taxation’.
On 29 May 2002, the Minister for Revenue and Assistant Treasurer published the Government’s Consultation Paper on the Inspector-General of Taxation in the Taxation System (‘the Paper’).
The purpose of the Paper was to present the key elements of the proposal for an Inspector-General and to seek public comments on the best ways in which the new Office would operate to improve the fairness, efficiency and integrity of the tax system.
Board of Taxation Report
Following release of the Paper the Minister asked the Board of Taxation to gather and consider the views of business, taxpayers, the tax advising professions and the community on the Paper and to make its own recommendations to her on the proposals.
The Board considered that, to be effective, the Inspector-General would need to add value to the tax system in a way that is clearly distinguishable from the functions performed by the Ombudsman, the Auditor-General and the Board.
The Board said that the Ombudsman’s principal role was to address complaints made by individuals. The Ombudsman also has a discretion to conduct ‘own motion’ investigations, including into systemic issues concerning tax administration. The Auditor-General undertakes performance audits examining the economy, efficiency and administrative effectiveness of the ATO’s administration of the tax system. The principal client of both the Ombudsman and the Auditor-General is the Parliament, and through it the public at large. Both report directly to the Parliament.
In contrast, the Board said the Inspector-General would be an adviser to government in the interests of taxpayers. The effective discharge of the role would require the Inspector-General to be frank and open with taxpayers, particularly in relation to the development of its work program and priorities and reporting on its outcomes.
Passage of the Inspector-General of Taxation Bill 2002
On 19 September 2002, the Inspector-General of Taxation Bill 2002 was introduced into the House of Representatives by the Treasurer. The House passed the Bill on 16 October 2002 and it moved to the Senate. On 23 October, 2002, the Senate referred the Bill to the Senate Economics Legislation Committee which reported on 3 December 2002. Subsequently, the Senate moved amendments on 12 December 2002.
In the Autumn 2003 Session of Parliament the Government proposed amendments to the Bill which were agreed to by both Houses of Parliament on 27 March 2003. The Bill was then given Royal Assent on 15 April 2003.
Appointment of the inaugural Inspector-General of Taxation
On 4 August 2003, the Minister for Revenue and Assistant Treasurer, Senator the Hon Helen Coonan announced the appointment by the Administrator of the Commonwealth of Australia of Mr David R Vos AM as the inaugural Inspector-General of Taxation. He commenced officially in this position on 7 August 2003.
Appointment of a new Inspector-General of Taxation
On 18 September 2008, the Assistant Treasurer, Chris Bowen MP announced the appointment of Mr Ali Noroozi as the Inspector-General of Taxation for a term of five years. He commenced officially in this position on 6 November 2008.