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  • KPI 5 performance summary

    Regulators are open and transparent in their dealings with regulated entities

    The following table shows the measures of good regulatory performance and the related metrics. The results of the metrics and analysis are outlined in the Appendix.

    Measure

    Description

    Metric(s)

    5.1

    Ensure risk-based frameworks are publicly available in a format which is clear, understandable and accessible.

    5.2

    Be open and responsive to requests from taxpayers regarding the operation of the tax and superannuation systems, and approaches implemented by the ATO.

    10, 11,
    S13–S15, A3

    5.3

    Ensure performance measurement results are published in a timely manner to ensure accountability to the public.

    5.4

    Ensure disputes are dealt with in an open and transparent manner.

    S16

    Note: There are no specific metrics for measure 5.1 or 5.3, as per the ATO Regulator Performance Framework.

    Self-assessment rating: Good

    This assessment is based on the results of the metrics relating to each measure and the examples of how we are open and transparent in our dealings with regulated entities.

    Summary of metric results

    Performance either improved or met target for three of the seven metrics for this KPI with one remaining broadly stable, two showing a decline and one based on activities.

    Our performance improved with respect to timely responses to complaints and request for private rulings, as well as letting clients know of status or delays. However, community perceptions of our timeliness and their ability to contact the ATO via their preferred method both declined this year and will be a focus where we will continue to focus in 2018–19.

    We publish our performance for all our service commitments monthly on ato.gov.au, and report on the performance of the ATO in achieving its purpose annually. We report on the performance criteria published in the Portfolio Budget Statements and our Corporate Plan through the annual performance statement included in the Commissioner of Taxation Annual Report.

    Activity-based examples

    Recognising that taxpayers need tailored support, we have justified trust programs to assure the income and indirect tax compliance of large corporate groups.

    The ATO has a number of initiatives designed to assist clients with their tax affairs. We provide public advice and guidance to help taxpayers understand their rights and obligations in a range of situations.

    We continue to engage with clients at an early stage, especially in relation to complex arrangements. This ensures we can influence client behaviour in a timely way, often before a transaction or arrangement has occurred. Our early engagement strategy was extended to all of our client segments in 2017–18.

    Due to the complexity of tax and superannuation law, it is inevitable that some areas of disagreement will arise. Where a taxpayer disagrees with an ATO decision, they have the right to have that decision reviewed. At these times, the ATO provides a dispute resolution service to ensure consistent application of the law and fair outcomes for the community. Our approach is to engage with clients as early as possible, dealing with matters before they reach the courts.

    Since 2015–16, all disputes are managed and resolved by officers who are independent from the original primary decision-making area, and who report to a separate Second Commissioner. We aim for a fair and efficient resolution, minimising the time and costs involved. Approximately two-thirds of objections are resolved within three weeks of being raised with us.

    To get better outcomes for taxpayers and the Australian community, we provide assistance in some cases, where taxpayers involved in an objection or dispute process may be disadvantaged by exceptional personal circumstances. Our Dispute Assist program aims to help these unrepresented taxpayers navigate the dispute process, and is also looking at ways to connect taxpayers with independent experts from charities and law firms providing pro-bono services.

    We continued to improve upon our use of alternate dispute resolution techniques, such as our in-house facilitation service and settlements as a means of pragmatically resolving disputes. In 2017–18, we received almost 250 referrals for in-house facilitation (a 99% increase over 2016–17). Each facilitation that resolves a dispute will save taxpayers and the ATO time, costs and prevent the stress that comes with protracted dispute. Importantly, it helps to provide certainty for taxpayers for future years, contributing to willing participation in the tax system.

    To give the community confidence that the ATO is exercising sound judgment, we seek assurance from a range of channels.

    Under our Independent Assurance of Settlements program, we have engaged four former Federal Court judges and refer the largest and most significant decisions on disputes to them for review. During the year, they reviewed 12 settlements and found that 11 provided a fair and reasonable outcome for the Australian community. Their feedback has provided insight into improving how the ATO undertakes settlements.

    Public groups and international clients have access to our Independent Review program. Since the introduction of the program in July 2013, there have been 64 reviews conducted for groups with a turnover greater than $250 million. This year we conducted 16 reviews, the most in any year of the program. Only one case has proceeded to litigation in the first five years of the program. This program has driven improvements in the quality of statement of audit positions for the large market and in clients’ understanding of our audit positions. We propose to pilot an expansion of Independent Review to the small business market in 2018–19.

    All matters in which the general anti-avoidance rules (GAAR) may apply are considered in accordance with our published practices and, in most cases, referred to the GAAR panel before a final decision is made. The panel members (external business and legal experts and senior ATO officers) provide independent advice on the basis of the facts of the matter to an ATO decision-maker. Of the 35 matters considered in the 2017–18 financial year, preliminary advice was provided on 15 matters and final advice was provided to ATO decision-makers on a further 20 matters.

      Last modified: 08 Feb 2019QC 57845