The ATO has adopted alternative dispute resolution (ADR) as part of implementation of wider government reforms4, including adherence to model litigant obligations and 'genuine steps' requirements under the Civil Dispute Resolution Act 2011 (Cth). It assists in decreasing legal costs by resolving disputes as close as possible to the original decision where appropriate. It is also helping us to build and enhance relationships and encouraging ongoing compliance from taxpayers.
The ATO provides internal negotiation skills training for staff. In 2011-12, the ATO piloted the use of tools at the audit stage to identify potential dispute cases and is currently developing its first Dispute Management Plan (DMP).
Alternative dispute resolution is a very broad term. ADR processes include:
- direct negotiation between the ATO and the taxpayer at any stage of a dispute
- mediation, including before litigation and also in the AAT and Federal Court
- Mutual Agreement Procedures (MAP) process, in international disputes at pre-litigation stage
- conferencing, conciliation, neutral evaluation and case appraisal.
The ATO prefers to resolve disputes through direct communication and negotiation with taxpayers and their representatives at the earliest possible stage.