Show download pdf controls
  • Voluntary compliance ratio

    The voluntary compliance ratio (VCR) complements the tax gap by measuring the proportion of taxpayers that are fully compliant with their tax obligations under the four pillars of compliance (registration, lodgment, payment and reporting). The VCR also estimates the value of revenue remitted without any direct intervention by us.

    We have calculated the VCR for GST, luxury car tax, WET payable, and petroleum and diesel excise. The step-by-step methodology we use to calculate the GST VCR is provided in this document. Similar methodologies are used to estimate the VCR for luxury car tax, WET payable, and petroleum and diesel excise.

    The VCR estimate is a cumulative assessment of compliance. Failure against one of the pillars counts as non-compliance in a taxpayer’s total tax affairs. Non-compliant taxpayers are removed from the starting population at each pillar, leaving a final compliant population, which is expressed as a percentage of the starting population. A taxpayer failing at any stage is considered non-compliant and is not tested for compliance at a later stage.

    We measure the VCR at both the taxpayer level and the value level.

      Last modified: 05 Nov 2015QC 47278