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  • Appendix – metric results and analysis

    The following table shows the metrics we use to assess our performance and their alignment across the measures for each KPI.

    Outcome-based metrics

    Metric

    Description

    Measure

    1

    Communication of our decision to consult on matters submitted

    1.1, 6.1

    2

    Complaints received

    1.2

    3

    Service commitment – 85% of complaints received are resolved in 15 business days, or within the date negotiated with the client

    1.2

    4

    Adjusted average cost to individual taxpayers of managing their tax affairs

    1.3

    5

    Time–cost index for business and superannuation funds to prepare and complete key tax returns

    1.3

    6

    Reduction in the unintended administrative costs to business of complying with government regulation

    1.3

    7

    Increased use of the ABR as the national business dataset by government agencies and the community

    1.3, 4.3

    8

    Proportion of ABN applicants obtaining a decision online at the point of application

    1.3

    9

    Elapsed time in days for private rulings

    2.1, 2.2

    10

    Service commitment – 90% of electronic taxpayer requests are finalised in 15 business days

    2.2, 5.2

    11

    Service commitment – 80% of private rulings are finalised in 28 calendar days of receiving all necessary information

    2.2, 5.2

    12

    Service commitment – 70% of objections are finalised in 56 calendar days of receiving all necessary information

    2.2

    13

    Service commitment – Objections – if we find that the request raises particularly complex matters that will take more than 56 calendar days to resolve after receiving all the required information, we will aim to contact you within 14 calendar days to 2.2 negotiate an extended reply – a target of 80%

    2.2

    14

    Service commitment – Private rulings – if we find that your request raises particularly complex matters that will take more than 28 calendar days to resolve after receiving all the necessary information, we will aim to contact you within 14 calendar days to negotiate a due date – a target of 80%

    2.2

    15

    Cost to collect net $100

    3.1

    16

    Improvement in the quality of key data on the ABR

    4.3

     

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 1 – Communication of our decision to consult on matters submitted (within 20 days)

    2

    (33% of 6 received)

    1

    (20% of 5 received)

    0

    (0% of 2 received)

    In 2017–18 there were only two matters received that were considered potential consultation matters. A decision was not made within 20 working days in either case. One matter did result in consultation and the other did not proceed to consultation. While we only have a small number of matters for potential consultation each year, this result represents an area of focus for potential improvement in 2018–19, to ensure more timely responses to relevant stakeholders.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 2 – Number of complaints received

    34,323

    25,073

    20,241

    Metric 3 – Service commitment – 85% of complaints received are resolved in 15 business days, or within the date negotiated with the client

    87%

    93%

    90%

    In 2017–18, the ATO received 20,241 complaints (inclusive of Inspector-General of Taxation complaints), a reduction of 19% compared to 2016–17. The number of complaints received is only a small proportion of our interactions with the community, representing 0.1% of the total tax returns lodged in 2016–17. The largest proportion of complaints received related to form processing, which includes flow‑through impacts to speed of refunds.

    Complaint processing performance was 90% resolved in 15 business days (or within the date negotiated), which exceeded the benchmark of 85%.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 4 – Adjusted average cost to individual taxpayers of managing their tax affairs

    (2017–18 performance target: maintain or reduce the cost, relative to 2016–17)

    3.6% reduction on prior year result

    (2014–15 returns)

    1.0% reduction on prior year result

    (2015–16 returns)

    Unchanged(1) on prior year result

    (2016–17 returns)

    Metric 5 – Time-cost index for business and superannuation funds to prepare and complete key tax returns

    (2017–18 performance target: remain stable or decrease)

    Overall trends remain broadly stable.

    The indicator tracks multiple indexes at the macro level and reports on the trend analysis. For this reason there is no quantitative data provided for this metric.

    Overall trends remain broadly stable.

    The indicator tracks multiple indexes at the macro level and reports on the trend analysis. For this reason there is no quantitative data provided for this metric

    Overall trends remain broadly stable.

    The indicator tracks multiple indexes at the macro level and reports on the trend analysis. For this reason there is no quantitative data provided for this metric


    Note 1: The unchanged result for 2017–18 reflects a less than 0.1% change in the adjusted median.  

    The adjusted median cost of managing tax affairs for 2016–17 income tax returns was unchanged compared to the previous year. Taxpayers who do not report an amount on this label are not captured in this calculation; however, over recent years a declining trend has emerged in the ratio of taxpayers claiming cost of managing tax affairs to the total individual taxpayer lodging population.

    The cost of managing tax affairs includes the costs of preparing and lodging tax returns and activity statements, fees paid to tax advisers, and the costs of tax reference material. While the impact of external market forces can influence these costs, our strategies for making it easier to comply, by providing better guidance and advice, and contemporary and digital services, also influence this trend.

    The time-cost index for business and superannuation funds uses averages of the time taken by taxpayers to prepare for and complete key tax forms. Index increases show it is taking longer to prepare and complete forms, while index decreases show it is taking less time.

    Across our main tax return forms and business activity statement (BAS) indexes, the time-cost index remains broadly stable, demonstrating that the time it takes for clients to complete key forms to meet their obligations has not increased. The exception to this is superannuation fund returns where the index has been more variable in recent years, likely reflecting the ongoing changes in the superannuation system.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 6 – Reduction in the unintended administrative costs to business of complying with government regulation

    (2017–18 performance target: $1.54 billion)

    $1.2 billion

    $1.39 billion

    $1.58 billion

    In 2017–18, an additional $184 million of reduction in administrative costs was achieved, bringing the total annual reduction, relative to the cost of businesses using lodgment methods via previous systems, to $1.58 billion. This exceeds the performance target of $1.54 billion. This result is largely due to a greater volume than anticipated of SuperStream transactions, contributing to SBR savings of $1.45 billion across the industry, while ABR savings were approximately $123 million and AUSkey token savings were $10 million.

    This indicates that savings to business and government from ABR program initiatives continues to deliver in reducing the reporting burden, minimising cost to business and enhancing business interactions through natural-based systems for the business community.

    As new initiatives such as e-Invoicing and Single Touch Payroll are implemented, savings are expected to increase further for both business and government.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 7 – Increased use of the ABR as the national business dataset by government agencies and the community

    (2017–18 performance target:

    Agencies – 300 using ABR Explorer

    9 using ABR Connect

    Community – 750 million ABN Lookup searches)

    140 government agencies using ABR Explorer

    14% increase in ABN Lookup searches

    232 government agencies using ABR Explorer (66% increase)

    32.5% increase in ABN Lookup searches

    312 government agencies using ABR Explorer (34% increase)

    Total of 1.031 billion ABN Lookup searches (32.5% increase)

    11 agencies using ABR Connect

    A 34% increase in the number of government agencies using the ABR, as well as a 32% increase in ABN Lookup searches (each exceeding their performance targets), reflect the value of the national business register information (the ABR) to government agencies and the community. The number of government agencies using ABR Connect web services has increased from 6 to 11, exceeding the target of 9 agencies.

    In 2017–18, a new service, ABR Agency Connect was developed, joining ABR Identifier Search but using contemporary technology and additional data elements. ABR Connect web services provide cost savings to agencies by giving them access to the latest business information, thereby reducing their need to separately collect and maintain their own information and allowing them to better design and deliver programs. Use of the services has steadily increased to an average of more than one million searches per month. ABR Agency Connect was released in a Beta version, with an expectation that it will supplant ABR Identifier Search once it goes into full production.

    We continued to enhance services to better support the increased use of ABR data, with improvements to ABR Explorer and ABN Lookup. The ABR Explorer tool supports over 310 eligible government agencies at all levels of government, with activities such as disaster response and recovery, planning and economic development, compliance and service delivery.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 8 – Proportion of ABN applicants obtaining a decision online at the point of application

    (2017–18 performance target: 80%)

    73.5%

    86.4%

    94.6%

    This measure demonstrates improvements in the online ABN process, particularly reduction in delays and lost income arising from those delays. Government impacts can include lost taxation revenue and additional welfare payments whilst clients are waiting for their ABN to commence their business.

    The proportion of ABN applicants obtaining a decision online at the point of application increased to 94.6% for 2017–18, an 8.2% increase on last year and well above our 80% target. The outcome is mainly due to the improvement being in place for the full year (only in effect for part of 2016–17) and demonstrates the improvement working as intended.

    We have identified that, although we created savings for business in increasing on the spot decision for ABN applications, we would like to issue ABNs only to those who are entitled to one. In 2018–19, as a result of the review (November 2017), we will look to design a risk based ABN application process aimed at guiding ABN applicants to understand their entitlement as they apply. While this will be as tailored as possible, we expect the online decision rate to drop (but still above the target). The exact timing of implementing up-front risk assessment will be subject to design and system implementation capacity.

     

     

     

    Metric

    Result

    Average days

    Median days

    2015–16

    2016–17

    2017–18

    2015–16

    2016–17

    2017–18

    Metric 9 – Elapsed time in days for private rulings

    38

    61

    62

    23

    36

    39

    Average elapsed days have remained constant in 2017–18 compared with 2016–17, while the median elapsed days have increased slightly. Compared with previous years, this result is a combination of:

    • a continued focus on finalising aged cases, and
    • an increase in early engagement with clients, resulting in a higher proportion of private rulings being of a more technical, complex nature.

     

    Result

    Metric

    2015–16

    2016–17(2)

    2017–18

    Metric 10 – Service commitment – 90% of electronic taxpayer requests are finalised in 15 business days

    93%

    92%

    92%

    Metric 11 – Service commitment – 80% of private rulings are finalised in 28 calendar days of receiving all necessary information

    91%

    85%

    88%

    Metric 12 – 70% of objections are finalised in 56 calendar days of receiving all necessary information

    86%

    77%

    86%

    Metric 13 – Objections – if we find that the request raises particularly complex matters that will take more than 56 calendar days to resolve after receiving all the required information, we will aim to contact you within 14 calendar days to negotiate an extended reply – a target of 80%

    90%

    87%

    88%

    Metric 14 – Service commitment – Private rulings – if we find that your request raises particularly complex matters that will take more than 28 calendar days to resolve after receiving all the necessary information, we will aim to contact you within 14 calendar days to negotiate a due date – a target of 80%

    89%

    89%

    92%

    These metrics indicate how timely and responsive we are with respect to a number of differing types of requests and forms of assistance that that may assist clients with meeting their obligations.

    In 2017–18 we improved our performance on four of the five metrics and maintained our performance level on the remaining one. We also significantly exceeded our performance targets for all five metrics. These results demonstrate that the ATO continues to provide taxpayers with timely assistance and certainty (on complex matters) to enable them to meet their obligations.

    Note 2: From 1 July 2016, the basis for the electronic taxpayer requests calculation changed from finalisation within 20 calendar days to finalisation within 15 business days.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 15 – Cost to collect net $100

    (2016–17 performance target: consistent with trend)

    $0.77 (gross)

    $0.84 (net)

    $0.74 (gross)

    $0.81 (net)

    $0.67 (gross)

    $0.74 (net)

    The decreased cost to collect $100 met the performance target for 2017–18 and is largely due to the 10.4% increase in collections in 2017–18. The cost to collect gross $100 (excluding GST and its administration costs) decreased from $0.74 in 2016–17 to $0.67 in 2017–18.

     

    Result

    Metric

    2015–16

    2016–17

    2017–18

    Metric 16 – Improvement in the quality of key data on the ABR

    3.2%

    See qualitative assessment in 2016–17 report

    See qualitative assessment below

    As noted in last year’s self-assessment report, we are measuring each field separately. Whilst key fields’ accuracy remains stable, ABN status (as measured by an ABN being in use/entitled) experienced a significant drop (13.2%) from last year.

    As a result of a review initiated by the Commissioner into the ATO’s approach to administering ABNs in November 2017, the majority of our planned integrity measures were reduced or stopped, along with changes to the data model used to manage the bulk cancellation of non-entitled ABNs – one of our key strategies in maintaining the integrity of the register. As a result, the number of bulk cancellations dropped to 200,000 in 2017–18, compared to 700,000 in 2016–17 while these campaigns were paused.

    We are also seeing an increase in ABN applications from sole traders who may not be entitled. Work is being done to understand and address this potential risk in engaging labour where individuals are being incorrectly required to obtain an ABN to work (i.e. contracting, gig economy).

    The accuracy of other key fields remains stable for the second consecutive year.

      Last modified: 08 Feb 2019QC 57845