• Goods and services tax

    We delivered on our key revenue commitment to government and the states and territories, collecting $2.0;billion in GST, penalties and interest from our compliance work.

    Through increased focus on property developers and linked entities that deliberately disengage from the tax system, we raised $202.2million in GST liabilities, including penalties and interest, and collected around $66.0 million, including collections from liabilities raised in prior years. We also focused on understatement of GST caused by deficiencies in accounting systems, changes in business structures, failure of internal controls to manage unusual transactions and human error, raising $418.8million in liabilities and collecting $393.9 million, including collections from liabilities raised in prior years.

    In 2012–13, we reviewed around 48,000 refund cases and escalated nearly 36,000 of these to audit, where we adjusted one out of three claims.

    Our compliance activities in 2012–13, led to a total of $401.2million of incorrect GST refund claims being corrected, with $277.6million of this from compliance activities undertaken before payment of the refund.

    Table 2.13 Compliance GST commitments and results, 2008–09 to 2012–13
      2008–09
    $m
    2009–10
    $m
    2010–11
    $m
    2011–12
    $m
    2012–13
    $m

    Liabilities commitment – direct

    1,957

    1,965

    2,243

    2,097

    2,122

    Liabilities raised – direct

    2,306

    2,427

    2,724

    2,665

    2,543

    Cash commitment – direct

    1,455

    1,460

    1,637

    1,512

    1,564

    Estimated cash collected – direct

    1,658

    2,012

    1,957

    1,985

    2,030

    NOTES
    The commitments and results are the total direct revenue outcomes.
    The liabilities figures in this table have been adjusted to reflect prior-year corrections identified and made. These corrections relate solely to active compliance results. These corrections do not impact the Budget or our financial statements.
    The liabilities and cash estimate for 2011–12 have been updated with adjusted outcomes only available since the tabling of Annual report 2011–12.

    In year three of the Working Together to Improve Voluntary Compliance program, our compliance activities raised $450.1 million in GST liabilities, and collected $406.8 million in GST from debt activities. This exceeded planned results of $449.8 million and $91.0million respectively. In the first half of the six-year program, we estimate that we have collected approximately three-quarters of the $2.3 billion GST target for the program.

    The inappropriate use of Australian business numbers to claim GST credits continues to be a feature of potentially fraudulent GST refund claims. This year, we conducted around 20,000 checks for incorrect or fraudulent registrations and removed over 4,500 GST registrations from the system. We are also monitoring around 1,650 registrants.

    We encourage taxpayers to make voluntary disclosures where they can identify an error in a previously lodged tax return or activity statement. In 2012–13, we raised around $233.6 million in additional GST liabilities with cash collections of $220.1 million, as a result of large-market voluntary disclosures. Large business market GST credit adjustments made during 2012–13 reduced previous year liabilities by approximately $8.5 million. This included approximately $3.8 million in credits made as a result of adverse court decisions, $2.9 million from objections found in favour of the taxpayer and $1.8 million in credits identified as part of our compliance activities.

    The GST gap is trending in line with 2009–10 estimates, providing reassurance that compliance levels have remained constant and there has been no significant increase in non-compliance. In addition, GST revenue is matching economic data, which suggests no deterioration of GST compliance levels.

    Figure 2.4 GST gap in Australia, 2005–06 to 2010–11

    GST gap in Australia, 2005–06 to 2010–11

    View table of Figure 2.4

    Figure 2.4: GST gap in Australia, 2005–06 to 2010–11
      2005–06 2006–07 2007–08 2008–10* 2010–11
    GST gap as a percentage of revenue 5.4% 5.7% 7.0% 5.4% 5.4%
    GST gap including debt 6.4% 6.7% 8.1% 6.9% 6.5%

    Table 2.14 GST gap, 2005–06 to 2010–11
      2005–06
    $m
    2006–07
    $m
    2007–08
    $m
    2008–10
    $m (a)
    2010–11
    $m

    Estimated GST gap excluding debt

    2,035

    2,295

    2,975

    2,335

    2,520

    GST active compliance results – gross

    1,484

    1,480

    1,708

    2,177

    2,777


    Figure 2.5 Impact of compliance action on the GST gap, 2005–06 to 2010–11

    Impact of compliance action on the GST gap, 2005–06 to 2010–11

      Last modified: 18 Dec 2013QC 42712