- The ATO should consult with taxpayers, tax practitioners and their representative bodies to identify discretions that should be replaced with an objective test and advise the Government of these discretions.
- In consultation with taxpayers, tax practitioners and their representative bodies, the Government should consider:
- replacing liability discretions in tax laws with objective tests; and
- replacing specific administrative discretions in relation to particular topics with a broader principle.
- The ATO should periodically consult on whether further ATO advice should be provided with respect to any liability discretions and where such advice is provided, what factors the Commissioner would consider as relevant and his reasoning in exercising his discretion.
Recommendation 5.4(a) is a matter for Treasury.
Recommendation 5.4(b) is a matter for government.
We agreed with recommendation 5.4(c) and implementation was completed on 21 March 2014.
We have conducted research into the demand for information about liability discretions on the ATO website. Based on the findings, we have not pursued the development of any additional advice or guidance. We conduct this research on a regular basis (currently every six months approximately). We also continue to respond to feedback from external forums.
The review focussed on improving aspects of the income tax self assessment system.