The Inspector-General of Taxation (IGT), Mr Ali Noroozi, today announced his new work program into aspects of the Australian Tax System’s administration, following an extensive community consultation process.
“The consultation process surfaced a wide range of issues and concerns that the community would like me to review. I want to thank everybody for their input. The range and depth of input enabled me to better understand and select areas for review. I cannot review every issue, however, my new program reflects areas of significant community concern or importance to the tax system’s administration,” said Mr Noroozi.
In developing this work program, the IGT has taken a new approach, designing a shorter work program that can be completed in a quicker timeframe. This new approach is more flexible, allowing the IGT to better accommodate any urgent review matters which emerge during the work program life cycle.
“My work program design has greater flexibility to make sure that I can now pick up and investigate any hot issues on a more timely basis,” Mr Noroozi said.
The IGT’s new work program consists of the following reviews:
- Review of ATO implementation of the Report on Aspects of Income Tax Self Assessment (ROSA) recommendationsThe review will examine whether the implemented ROSA recommendations have been successful in achieving their original aims and whether there are any further improvements that can be made.
“The time is ripe to assess the effectiveness of implemented ROSA recommendations and whether further improvements can be made,” said Mr Noroozi.
- Review into ATO use of benchmarking to target the cash economyThe IGT will investigate whether benchmarks are an appropriate tool for identifying the potential underreporting of income and the calculation of default assessments, and whether the ATO’s expectations in relation to micro and small business record keeping are clearly communicated and reasonable.
- Review into ATO use of early and alternative dispute resolutionThis review is being conducted both at the request of taxpayers and their representatives as well as the ATO. It seeks to determine whether the ATO is currently making sufficient use of early and alternative dispute resolution and whether the ATO and taxpayers could benefit by broadening use of these methods.
- Review into the ATO’s small and medium enterprise audit and risk review policies, procedures and practicesStrong stakeholder representations were made about onerous and unnecessary costs and workloads imposed through ATO compliance action. The terms of reference for this review have been set and the review is currently under way.
- Follow-up reviewRecommendations contained in a number of reviews completed since November 2008 will be subject to an implementation review.
“Overall, the program aims to improve the tax system’s administration for all Australians. I look forward to working with the ATO to identify and deliver improvements for the community’s benefit,” Mr Noroozi said.
During the consultation process, various concerns were raised which were either being addressed by the ATO or were identified as being better suited to review by other agencies. These concerns related to areas such as:
- ATO technical decision making processes and proceduresThis issue has been raised in many IGT reports historically and was again raised last year in the Review into delayed or changed ATO views on significant issues (the ‘U-turns’ review) as well as in the IGT 2009-10 annual report. The ATO has responded to the IGT’s concerns by conducting an internal review that made significant recommendations for change. These have now been adopted by ATO management.
“I have chosen not to review the ATO’s technical decision making processes and procedures at this time. I am pleased that the ATO has responded to my concerns and conducted its own internal review, seeking to make significant changes. Once these changes are bedded down, then I will consider whether a further review is warranted,” he said.
- Project WickenbyThe ANAO recently announced a cross agency review into Project Wickenby. The Ombudsman has also indicated that he is considering a cross agency review into the matter.
“The ANAO and the Ombudsman have much broader jurisdiction to investigate or review across various agencies, whilst I am limited to the ATO. I’ll wait for the results of the ANAO review as well as the Ombudsman’s decision before considering a further review myself. If the Ombudsman does conduct a review I would be pleased to provide any appropriate assistance as required,” Mr Noroozi said.
As we commence each review, terms of reference will be prepared and submissions will be sought. Further details are available on the IGT website at www.igt.gov.au.
4 April 2011
Media contact: Ali Noroozi (02) 8239 2107