Tax & ATO News Australia

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External Scrutiny Into the ATO

The house of representatives committee on taxation is currently accepting submissions into the external scrutiny of the ATO. This is after recent comments from the Commissioner of Taxation, Chis Jordan that there is too much scrutiny of the ATO. 

Encouragingly, Liberal Senator, Bronwyn Bishop, has resisted this call, saying that given the ATO’s role is to collect money and this has the potential to effect peoples’ lives, parliamentary scrutiny should remain.

More critically, the power that the ATO has to collect money is virtually unlimited, as I have written about before. This power, coupled with a culture that oscillates between rabidly aggressive (at worst) to uncompromising (at best), means that there is always a real risk that an individual ATO officer will go too far and destroy someone’s life in the meantime. This has happened, and I have personally been involved in many such cases, including cases that are deserving of compensation, so badly has the ATO behaved.

The Inspector General of Taxation, Mr Ali Naroozi, does an excellent job of scrutinizing the ATO, with limited resources. Mr Naroozi is a sensible and appropriately skeptical watchdog and needs more scope to review what the ATO does, not less. It would be an absolute disaster if the parliament was convinced that the ATO should be unsupervised.

If parliament agreed with the Commissioner of Taxation in this regard, the result will only be worse for taxpayers, including in particular those many taxpayers who are ultimately showed to have done nothing wrong. There must be consequences if the Commissioner’s actions cause an individual who has not avoided tax at all to lose their business, their house or worse. This has happened, and must not happen again.
 

Posted in: Tax & ATO News Australia at 22 March 16

ATO communication improving? Fingers crossed.

I recently attended a meeting between a number of ATO officers and representatives from the legal profession around Australia.  The meeting was billed as a high level communication exercise, as the ATO is eager to improve relationships with lawyers generally.


Surprisingly, the meeting was very positive.  Representatives of the ATO, right up to the Assistant and Deputy Commissioner level appeared genuinely committed to a new process.  Hopefully this will translate into real changes on the ground.  From past experience, this has not happened.

 

One of the major focuses over the next twelve months for the ATO is debt disputes (that is, where debt matters end up in court for recovery action).  I raised as some length my experiences, some of which I have shared previously, of debt recovery matters where there is a real dispute that the tax debt is wrong and there are appeals on foot.  The ATO (at a high level) were adamant that the ATO did not take debt recovery action when there was a genuine appeal. 

 

I told them they were wrong and gave an example of a taxpayer who sold her house at the height of the GFC because of the pressure she was under from the ATO debt collection department.  She not only had lodged an appeal, but we eventually won with all assessments set aside.  This was cold comfort to her, as she had lost a fortune selling her house in a fire sale in a depressed market.

 

The ATO is keen to hear more examples of these sort of thing happening.  Hopefully they are genuine.  I hope to bombard them with examples.  I have several, but I am hoping that if anyone has a story of debt collection gone horrible wrong, that they could share it with me (anonymously) so that I can start to collate some feedback from the ATO.

 

You can reply below, or email my personal assistant confidentially at abermingham@smh.net.au

Posted in: Tax & ATO News Australia at 24 February 14

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Tax & ATO News Australia

Author: David Hughes

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