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Australia is underpinned by a myriad of government funded goods and services. The revenue system is an important instrument of social and economic policy. It is a vital ingredient in Australia's wellbeing.
The shape of the revenue system is a matter for government. The Tax Office's responsibility is to administer the tax law in a way that instils community confidence and encourages high levels of voluntary compliance. We also bring the government's attention to areas where the law is not operating in accordance with the policy intent or producing significant compliance costs. We hope to create an environment which allows the revenue system to achieve its objectives.
Our commitment to the community is to administer the revenue system fairly, in accordance with the law. We do this by helping taxpayers and their agents to understand their rights and responsibilities; by making it as easy as possible for them to comply; and by supporting those who want to comply by ensuring that there are real and tangible risks for those who don't - this is all about fairness for taxpayers and a level playing field for business.
Australia's revenue system generally relies on taxpayers self-assessing their tax liabilities under the law and paying the correct amount of tax. Fortunately we have a culture where the majority of Australians do the right thing and voluntarily comply with their tax obligations. So a key approach for us is to differentiate between taxpayers who are trying to comply, and those who are not. This perspective underlies the taxpayers' charter and our compliance model, which require us to understand taxpayers' circumstances, behaviours and risk profiles to develop appropriate and proportionate responses. Increasingly we are working with representative bodies to help us co-design those responses.
Having said that, we are not able to chase down every dollar of revenue nor are we able to satisfy everyone's wish-list; we are simply not resourced to do that. We have to make informed choices in the management of the revenue system and to direct our attention and effort (both help and active compliance) to the areas that are likely to have the biggest impact on levels of voluntary compliance. We have to do this while still maintaining a presence (both help and active compliance) across all the different market segments to ensure continued community confidence. These are not easy decisions. That is why we make our compliance program public and seek input from the community on our priorities and the risks to its revenue system.
This year's compliance program describes the current and emerging risks we perceive to the effective operation of the revenue system, and how we propose to use our resources. We are open and accountable about our strategies, which reflect an appropriate mix of help, support, deterrence and enforcement, in order to encourage high levels of voluntary compliance.
The publication of our compliance program is also an invitation to the community to provide feedback to us on the risk management choices we have made. I encourage and look forward to a heightened level of engagement by the community and representative bodies in the care and management of Australia's revenue system.
Michael D'Ascenzo
Commissioner of Taxation
Last Modified: Monday, 28 August 2006