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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.

    n/a(1a)

    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.

    S7, S8

    5.3

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

    n/a(1a)

    5.4

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

    S6

    Note 1a: There are no specific metrics for measures 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 improved for two of the three metrics for this KPI while the other metric result was stable.

    Community perceptions of confidence in the ATO increased overall. Perceptions of fairness in disputes increased with regard to the process but decreased in relation to the final decision.

    Activity-based examples

    Our governance arrangements support the Commissioner in leading the ATO, setting our strategic direction and ensuring we meet our commitments to government and the community. Arrangements we have in place to assist us in implementing the principles and objectives of corporate governance include:

    • sound governance structures
    • integrated fraud and risk management
    • open and transparent operations
    • being accountable to our stakeholders.

    We fulfil our corporate governance responsibilities by complying with accountability requirements in legislation and policy and meeting public expectations of good management. We regularly review our corporate governance arrangements and ensure our staff have training and information on how the ATO is governed and how we are all held to account.

    Australia’s tax and superannuation systems are community assets. Appropriate access to information about these systems enhances transparency and leads to increased levels of trust and confidence

    External scrutineers provide independent reviews of the ATO’s operation – either as the result of their own annual program of work, or in response to concerns raised by members of the public and the Australian Parliament. Reviews help us to identify options for improving services to our clients, address potential barriers to willing participation, and ensure the successful delivery of outcomes in our administration of the tax and superannuation systems.

    Our Taxpayers’ Charter outlines clients’ rights and obligations. It explains what clients can expect from us in administering the tax and superannuation systems and outlines our commitment to dealing with clients in a way that is professional, considers their circumstances, and provides them with relevant information. We are committed to following it in all our dealings. Our performance against the Taxpayers’ Charter in 2019–20 can be considered satisfactory, with an improvement in client and community perceptions when compared to 2018–19.

    Our Tax and Corporate Australia publication details how we assure that corporate taxpayers pay the right amount of tax and how we assist them to do so. It sets out the ways we are improving the system for those who want to comply, and how we are taking firm action against those who choose not to. It also discusses our areas of focus and details our past compliance performance.

    One of our strategic objectives is to build community confidence by sustainably reducing the tax gap and providing assurance across the tax and superannuation systems. Tax gap estimates allow us to better understand levels of compliance and risk in the tax and superannuation systems. The insights gained from this work can guide us in determining priority risks and developing strategies (including administrative design, help and education, and audit), which aim to sustainably reduce the tax gap.

    In October this year, we released a further five gap estimates and for the first time, have published gap estimates for all 15 income-based and transactional based taxes. Achieving this has allowed us to estimate the overall tax gap as $31.1 billion, or 6.9% of the total tax we would collect if everyone was fully compliant with tax law. Put another way, we see $423 billion in overall tax paid for 2017-18 meaning we received 93% of tax revenue, the bulk of which was voluntary.  With the full release of the tax gap program this year, we are now able to view the performance of the tax system over the past three years. The results show that the tax gap has reduced from 7.7% to 6.9% over the past three years, showing the system is performing well and improving.

    To ensure the published figures are credible (believable and complete), meaningful (explained) and reliable (dependable and trustworthy), an independent expert panel review and approve all gap estimates annual before they are published. Additional information is available at ato.gov.au/taxgap

    The ATO continues to focus on improving client interactions. As with experiences around the world, 2019–20 was a unique year for the ATO. In particular, the implementation of the COVID-19 stimulus measures and the low and middle income tax offset saw an increase in community interest and interactions. That trend was also seen in complaints, with 24,778 received for the year (inclusive of those from the IGTO), compared to 19,826 in 2018–19. Although the year brought challenges, the flexibility of the ATO’s front-line resources enabled us to adjust our efforts and redirect resources where needed. This saw a complaint finalisation result of 83% resolved in 15 business days or within the date negotiated, slightly below our target of 85%.

    Complaints, feedback and compliments provide valuable insights to identify enhancements to our services. In 2019–20, the ATO received 3,430 items of feedback which most often related to enhancements to our online services, as well as our communication products and channels. In addition, 2,079 community compliments were received, which reinforced our efforts to deliver good client experiences, often relating to positive interactions delivered by our staff, as well as the usability of our services.

    Some clients will disagree with our assessment of their tax and superannuation system obligations. We aim for our dispute resolution process to build trust and confidence within the community that our decisions are fair, reasonable and made in accordance with the law. To support the Better as Usual program, we improved the way we collate information from objections, facilitation, Dispute Assist and complaints. This allows us to develop actionable insights to improve our client engagement and ultimately reduce the proportion of actions that result in objections and complaints.

    We resolved over 22,000 objections, which represents less than 0.1% of over 38 million returns lodged. There were 455 applications for review or appeal to the Administrative Appeals Tribunal or other courts in 2019–20, with 153 decisions made either in relation to these applications or applications made in earlier years. The significant gap between the number of applications and actual decisions reflects the fact that most matters are resolved through alternative dispute resolution. For more information on numbers of disputes, see Appendix 3 of the Commissioner of Taxation annual report 2019–20.

      Last modified: 05 Feb 2021QC 64650