It is inevitable that a new second Australian Taxation Office commissioner will be appointed to hear taxpayers’ appeals, Inspector-General of Taxation Ali Noroozi says.
On Tuesday Mr Noroozi told Senate Estimates complaints had increased following the joint Fairfax Media-ABC investigation into the ATO. His office acts as a watchdog over the ATO and also hears individual and small business complaints about the agency.
He said that since the Fairfax Media-ABC went to air in early April, his office had received 522 complaints, representing an increase of more than 60 per cent and 53 per cent for the same two months in the two prior years respectively.
“Of these complaints, 62 have specifically mentioned the Four Corners program and we
are investigating over half of them with the ATO,” he said. “We have addressed the remainder without involving the ATO.”
Part of the ‘Four Corners’ program ‘storm’, was allegations of an ATO officer: Richard Boyle, that the recovery excesses were driven by an estimate which the ATO gave to Government, each May, about the amount of tax they would recover in the following year. The Sydney Morning Herald’s report says:
Others, including former senior ATO insider Ron Shamir, told the joint investigation his division in the Box Hill branch in Melbourne had revenue targets that had to be met.
He referred to it as “the plan”, an estimate of how much tax revenue the tax office will be collecting in the forthcoming financial year.
“It’s an estimate given to government so that it can plan and know how much tax revenue is to be collected,” Shamir says. “It then cascades down to various tax office branches and becomes a target of what they will be collecting in revenue for that financial year.”
Shamir says the pressure would build and result in shortcuts and staff looking for easy targets.
“You would be looking at taxpayers who are less able to resist the might of the tax office – taxpayers that are more vulnerable,” he says. “And that often meant individuals and small businesses – rather than larger businesses – who had less legal resources.”
Shamir was sacked in mid-2015 for non performance. He took his case to the Fair Work Commission, winning initially but losing on appeal. The ATO offered to settle his case but he refused to sign a gag order.
The Age/Sydney Morning Herald/Four Corners investigation spoke to other current and former employees who confirm what Shamir says. One senior tax office insider, who wished to remain anonymous for fear of retribution, says “the plan” continues to exist and trickles down to employees in each business line. He says that, within each business line, key target areas are identified and revenue goals attached.
[LTN 107, 6/6/18; Tax Month – June 2018]
Study questions (answers available)
- Was the Senate Estimates Committee hearing about the IGT/Ombudsman’s increase in complaints since the ‘Four Corners’ program aired?
- Were there 225 complaints in May 2018, representing a 30% increase on the same period 2 years prior?
- Did 62 of these expressly mention the Four Corners program?
- Was a key allegation that the estimate of next years tax collections, which the ATO gave Government for budget purposes, cascaded down the organisation as collection targets, leading to pressure on officers and abuses (what they called ‘the Plan’)?
