2. Register of private binding rulings
At the 26 November 2008 NTLG meeting the Tax Office advised that it did not see the current private binding ruling (PBR) register as an appropriate source of advice and guidance for tax practitioners and that it proposed to convert it to a simple number and subject title listing only. However, this proposal was strongly contested by other NTLG members as being a backward step since practitioners find the register to be a useful guide to the Tax Office position on particular issues and generally superior in this regard to ATO Interpretative Decisions (ATO ID).
The Tax Office has since deferred the introduction of the abovementioned initiative pending further discussions with external NTLG members in early 2009 against the background of recent improvements to the Tax Office’s advice and guidance products, including access to its website.
While these changes are welcome, the external members remain of the view that the PBR register should be retained until such time as the current ATO ID register is significantly enhanced to ensure that it is able to provide a similar level of advice and guidance as is currently available from the existing PBR register. A necessary step to achieve this would be to ensure that existing and future ATO IDs included examples of the relevant factual circumstances to provide further clarification of how the law applies in such situations.
Another central issue is that of transparency. ATO IDs only issue when the Tax Office decide to issue one. In the absence of PBRs being published, we have no way of knowing what the Tax Office are advising or being asked to advise on, and thus what issues are not covered by an ATO ID.
The Professional Bodies also seek an update from the Tax Office of the outcomes of their discussions with each Body and stakeholder.
Response
The Register of Private Binding Rulings (the register), available on the Tax Office's website, is an historical record of private rulings issued by the Commissioner over the past few years, that are edited to remove information that might identify the taxpayer to whom the private ruling relates.
In November 2008 the Commissioner informed the National Tax Liaison Group (NTLG) that he was considering reducing the contents of the register to the subject heading and reference number for each private ruling. Research undertaken by the Tax Office revealed that the register was being used for purposes not intended at the time it was instigated. Tax Office investigations showed that some people were using the register for research purposes. The Commissioner considered, among other things, that as the register contains some outdated and misleading material (the latter mainly due to the editing process), it was posing too great a risk to the community and should be modified.
The Tax Office received a number of representations from the tax profession and the Inspector-General of Taxation raising concerns with the Commissioner's decision, and undertook a round of discussions with NTLG members to better understand the professions’ concerns, to further explain our reasons for the proposed change, and to provide further information about our advice and guidance products, such as ATO IDs.
These discussions have been very helpful. We have been reassured by the NTLG’s clear understanding of the limitations and risks associated with the register, and by the NTLG’s willingness to work with the Tax Office both to reinforce this understanding across the tax profession and to assist tax practitioners to get the most out of our advice and guidance products such as ATO IDs. Together, we will ensure that the register can continue to provide transparency on the rulings system.
In light of these discussions, on 3 March 2009 the Commissioner issued Media release 2009/16 stating the register will be maintained in its current form.
The Commissioner also invited the Inspector-General of Taxation to review the private rulings system, including the register, and looks forward to working with the Inspector-General to ensure the register can continue to deliver transparency to the public in the most effective and productive way.
Meeting discussion
The members thanked the Commissioner for his attention to this issue and agreed that a good resolution had been achieved.
The Commissioner and Second Commissioner Quigley reiterated their previous offer to continue to work together to improve ATO IDs.
It was noted that there is a need to publicise the availability of ATO IDs and members were invited to include information in their association newsletters or magazines.
Sections within Agenda items
Last Modified: Friday, 3 July 2009
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