• Attention


    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Taxation Institute of Australia
    32nd Annual State Convention - Queensland
    Gold Coast

    Michael D'Ascenzo, Second Commissioner, Australian Taxation Office

    16 May 2003




    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    A theme such as 'Shifting Sands' is apt to bring to mind hackneyed jokes such as the economist on the desert island who finds a can of food. Now how to open the can - "assume a can opener"; or the person dying of thirst in the desert who is given a wish by a genie - and he wishes for a car door. Why - so that he could wind down the window and let the breeze through.

    In your practice it is risky to 'assume' things in providing advice to your clients, and when workloads and frustrations make you feel as though you are being engulfed by sand, I can imagine some of the wishes you might make. Some of which I may not find pleasant; so remember that the ATO is merely the administrator of your tax system not its maker.

    Let's assume that the wish we make is for a helicopter to pull us out of the shifting sands. And as we are pulled up - we are afforded a helicopter view of the lie of the land. In my presentation I will try to cover some aspects of the wider horizon - at least the ATO's view of it.

    Let me start with the way the ATO is evolving and adapting.

    The Legislative Function

    One major organisational change has been the shift of responsibility for doing drafting instructions from the ATO to Treasury. 1

    Treasury has always been Government's main adviser on tax policy. The ATO worked closely with Treasury and consultative forums in translating that policy to drafting instructions which went to the Office of Parliamentary Counsel who actually draft the law.

    Now those drafting instructions are also done by Treasury. The ATO continues to maintain close relations with Treasury and assists by bringing to the table an administration perspective. For example, we advise on the administrative cost and feasibility of a proposed measure, and the potential impacts of the measure on taxpayers. This shifting of the sand allows the ATO to develop closer partnerships with tax professional and business and community groups in bringing to policy discussions the administrative and compliance impacts of a proposed legislative measure. The ATO hopes to evolve and adapt in a way that brings added value to the legislative process, being the value added of the administration and user/client perspectives.

    Timing Difficulties

    The legislative agenda remains a full one with many of the initiatives arising from 'A New Tax System' 2, the Ralph Report 3 and the upcoming review of International Taxation Arrangements 4 still to be finalised. 5

    Taxpayer compliance and Tax Office administration of measures having effect from a certain date is extremely difficult and problematic where those measures have not been enacted at the time of their commencement date. The fact that we have been able to make the system work is illustrative of the closer working relationships that have (both as a matter of necessity and as a matter of desirability) been forged between the ATO and tax agents and relevant representative bodies.

    And it seems that even at this early stage the ATO's strategies seem to be working:

    "While Treasury is driving legislative and policy change, it is the Tax Office which is charged with ensuring the system is working. We are therefore seeing a growing keenness on the regulator's part to explore opportunities to better implement the law in a way which reduces costs on both sides and assists organisations comply." 6

    Below are some recent examples.

    Capital Protected Products

    As you know, the Government announced on 16 April 2003 that it will amend the tax law to ensure that part of the expense on a capital protected product is attributable to the cost of the capital protection components is not interest and is not deductible. The amendment will apply to arrangements, including extensions of existing arrangements, entered into after the time of the announcement (9:30 am, 16 April 2002).

    So what do taxpayers do in the interim? The ATO has been working with industry representative bodies to develop approaches that provide certainty for particular arrangements under the current law. We will be making an announcement on this soon.


    After a fairly long gestation period the new income tax consolidation regime is now becoming a reality for many corporate groups. The new consolidation rules apply from 1 July 2002, and early balancing company groups are the first to be preparing a consolidated income tax return under those rules. December balancers are due to lodge those first consolidated returns on 15 July.

    Understandably, there is a growing focus on the practical issues associated with completing those returns; and two particular issues are covered below - both relating to certainty about the new regime.

    Introduction of the consolidation regime has required some fairly substantial legislative changes, with four major amending Bills now passed into law to establish the regime. Throughout the development of the new rules there has been a tension between getting the rules in as soon as possible to deliver the business benefits that the Ralph Report saw flowing from the changes, and the development of a sufficiently comprehensive package to provide the necessary certainty about how the rules would operate. Both the business community and the public sector initially underestimated the complexity of the task, and there were also concerns about the business community's capacity to deal with the change in the context of other tax reforms. Consequently the commencement of consolidation was delayed from the original 1 July 2000 date ultimately to 1 July 2002.

    Even on the revised timetable it became clear that some innovative approaches were needed to help the business community come to terms with the new rules. 7 Central to those approaches has been the development of the consolidation reference manual which has been progressively updated as the legislation has been passed, with the next major update of that publication occurring in the next couple of weeks. The reference manual has been well received as a timely, contemporaneous exposition of how the ATO proposes to administer the consolidation regime.

    Like other ATO publications the Reference Manual comes with the Commissioner's guarantee about penalties, but it does not offer the legally binding primary tax protection that can be obtained through the system of binding taxation rulings. Nor do we think that it would be appropriate for us to treat the whole manual as if it were a ruling, or to administratively tie ourselves in one fell swoop to the primary tax outcomes that would be concluded by applying the guidance provided in the manual.

    The reasons for this are quite simple. Firstly, Parliament has itself provided the rules in the law and its intentions are best given effect to by a reasonable application of the law to particular facts. That law is also accompanied by an Explanatory Memorandum.

    Secondly, while we have taken all due care in preparing the manual and consider it to be a high quality guide, it has been developed as a general guide; it has not been subject to the degree of scrutiny that routinely accompanies the development of a product that is legally binding, nor is it prefaced by a specific class of arrangement which limits the factual scenarios to which it may be applied in a binding way. This has simply not been possible in the circumstances where we have been trying to provide rapid guidance on a large body of new law to fit the bulk of likely factual scenarios. That is, the price of getting the reference manual material out quickly using streamlined processes is that we are only prepared to stand by it for penalty purposes - further processes would be required to provide the necessary assurance that the general community would expect before conferring a higher status.

    Having said that, we do provide private binding rulings on key issues currently covered by the manual, and will convert, through the proper processes, key aspects of the reference manual into public rulings. Alternatively, if a matter is more concerned with questions of administration than interpretation we will issue Practice Statements. For example, we are currently doing that in relation to the over-depreciation adjustment of the cost setting rules. The proposed Practice Statement will provide a workable methodology for this adjustment.

    Through our standing community consultation arrangements for consolidation we have already established an embryonic public rulings program, covering interpretational aspects of the new regime which representative bodies consider require clarification as a matter of priority. This prioritisation process includes matters that are currently covered by the reference manual. Our sense at the moment is that the current demand lies more in providing guidance in areas where there currently is none, and this is likely to remain our primary focus in the short term, but we are open to suggestions.

    The second issue about certainty relates to the potential for there to be gaps in the legislative regime as taxpayers explore its intricacies, including how it connects with other aspects of income tax and other revenue laws.

    The current legislative package for consolidation has been designed to give most taxpayers all that they need in order to proceed to consolidate for income tax purposes, and many companies are proceeding accordingly. However, our experience tells us that there are likely to be particular areas applicable to some taxpayers where further legislation will be needed to bed the regime down completely, and the Government has acknowledged this reality by noting that some further interactions are still to be finalised.

    The ATO will provide guidance where there is genuine uncertainty on the application of the enacted law to particular circumstances. There is after all only a need to complement the law in areas of genuine uncertainty. 8

    However, should there be cases where there is a gap in the enacted laws, it would be difficult for the ATO to provide any advice on this aspect, pending further legislation. In those circumstances the question for a taxpayer preparing an income tax return becomes "what should I do", especially where the gap potentially bears on the taxpayer's tax liability.

    The ATO's advice for taxpayers who may find themselves in these circumstances is simply that they should act reasonably, given the nature of the issue, the circumstances in which it arises and the broad objects of the consolidation regime. Taxpayers should keep a record of what they have done and why they have applied the law to their facts in that way. If it subsequently transpires following the introduction of further legislation that an amended assessment is required that increases their liability 9, a taxpayer who has acted reasonably will not be subject to any culpability penalties. Further, any general interest charge that may be attracted because of an amendment in these circumstances would be remitted to a time value of money component only.

    Simplified Imputation System

    The simplified imputation system took effect from 1 July 2002. It changes the mechanics of the former imputation system but generally achieves the same outcome as the former system. The new law is contained in Part 3-6 of the Income Tax Assessment Act (1997).

    The franking account now operates on a tax-paid basis and is also now a rolling-balance account. The conversion to the tax-paid basis removes the need to do complex calculations on the franking account when there are changes to the corporate tax rate. More information on converting the franking account can be found in the Fact Sheet entitled: Simplified Imputation - The Franking Account).

    The new rules also enable corporate tax entities to align their period for determining Franking Deficit Tax with their income year.

    The benchmark rules replace the 'required franking amount' rules and while similarly limiting streaming opportunities, provide greater flexibility in allocating franking credits to frankable distributions. Distributions made within the same franking period must be franked to the same extent. Distributions in subsequent period/s can have different franking percentages. (See Fact Sheet entitled: Simplified imputation - the benchmark and anti-streaming rules).

    The gross-up and credit approach replaces the intercorporate dividend rebate for companies in receipt of franked distributions. This means that like most other entity types corporate tax entities will now be required to include the distribution and the franking credit in their assessable income. They will then receive a tax offset equal to the franking credit included in their assessable income. This change has lead to new labels being included in the Company Tax Return Form

    Franking deficit Tax (FDT) and deficit deferral tax have been incorporated into the one tax (FDT). Also, Franking additional tax will be replaced by a rule which affects the creditability of FDT against future income tax liabilities where there has been excessive over-franking. Legislation to achieve the latter simplification is still to be introduced but is planned to apply from 1 July 2002.

    The 'no wastage of current year losses' and 'optional use of prior year losses' rules were introduced in Taxation Laws Amendment Bill (No5) on 27/3/03. The rules ensure that corporate tax entities are no longer required to use up losses against franked dividend (effectively tax -free) income. This will preserve these losses such that they can be deductible in a later year of income.

    This means that corporate tax entities in most circumstances will be able to:

    1. Treat a current year loss that would otherwise be wasted against franked dividend income as a tax loss for that income year. They will then be able to carry this loss forward for consideration as a deduction in a later income year; and
    2. Choose the amount of prior year losses they deduct in later income years.

    On 19 February 2003, the Australian Treasurer, Hon. Peter Costello, and the New Zealand Minister of Finance and Revenue, Hon. Dr Michael Cullen, made a joint announcement that legislation will be introduced in May 2003 to give effect to trans-Tasman imputation reforms.

    The ATO is responsible for the implementation of the rules to allow a New Zealand company (if it chooses) to elect into the Australian imputation system. Subject to full compliance with the Australian imputation rules, a New Zealand company that has elected into the Australian imputation system is able to maintain an Australian franking account and frank dividends with Australian franking credits. The New Zealand Inland Revenue Department is responsible for the implementation of the rules to allow an Australian company to choose to enter the New Zealand imputation system. The two revenue authorities are working closely together to implement these reforms.

    The reforms have two applicable dates:

    • To allow a New Zealand company that elects in to keep an Australian franking account from 1 April 2003. An Australian company that elects in will be able to keep a New Zealand Imputation Credit Account from 1 April 2003; and
    • To allow a New Zealand company that elects in to pay dividends franked with Australian franking credits from 1 October 2003. An Australian company that elects in can impute dividends with New Zealand imputation credits from 1 October 2003.

    Further information about the announcement is available at the Treasurer's website on www.treasurer.gov.au, and from the Department of the Treasury on (02) 6263 3822.

    An Evolving Tax Administration

    The ATO's business model 10 consists of the following:

    The ATO is not - and can never be expected to be - resourced to review every transaction or event. The reality is that effective revenue administration is not about collecting every last dollar payable under the tax laws. Choices have to be made about how best to direct our activities to address areas of greatest risk while at the same time maintaining community confidence in the tax system.

    The ATO is not - and can never be expected to be - resourced to review every transaction or event. The reality is that effective revenue administration is not about collecting every last dollar payable under the tax laws. Choices have to be made about how best to direct our activities to address areas of greatest risk while at the same time maintaining community confidence in the tax system.

    Increasingly, the ATO is making those choices in consultation with key stakeholders; and both the process and the choices made are explicit and transparent.

    2003 Compliance Plan

    This year the ATO released publicly its Compliance Program for 2002-03. A copy of the 2003 Compliance Plan can be obtained from the ATO website www.ato.gov.au - publications. A snapshot of the Compliance Plan is provided in the Commissioner's Media Release 2002/111 of 11 December 2002. The 2002-03 Compliance Plan is premised on extensive risk analysis, and the ATO's Compliance Model that requires us to understand the factors that influence different compliance behaviour so that we can choose the most appropriate intervention for the circumstances.

    The Compliance Plan is an interesting read and gives people confidence that their tax system is being managed fairly and efficiently in an open and accountable way. In terms of transparency, it outlines how we see the lie of the land and the choices we make. For example, in relation to small to medium enterprises (SMEs - which are businesses with turnover between $2m and $100m) it notes that the ATO is focussing on working with tax professional associations and industry bodies to identify areas causing taxpayers difficulties or presenting a risk to the revenue. We have covered a wide range of industry partnerships to facilitate joint approaches to resolving matters of concern. Examples of this include:

    a. Clothing Industry Partnership: An alliance between the ATO, Centrelink, Department of Immigration, Customs, state Workcover agencies, TCFU and ethnic community groups to deal with problems in the clothing industry including the exploitation of outworkers and problems of tax avoidance and social security fraud in the clothing industry.

    b. Property and Construction Industry Partnership: The property and construction industry partnership was used extensively to communicate information about the new alienation measures 11 and explain how they operate.

    c. Retail Industry Partnership: Previously, the GST Food Industry partnership which was established with the Australian Food and Grocery Council:

    d. GST Retirement Villages Industry Partnership: Established to clarify GST issues for retirement village proprietors and residents, and communicate resolved issues widely through ATO and industry networks.

    While the tax performance of SMEs has generally been improving, our analysis shows that in 2 000 business at the larger end of this segment there is an increasing gap between profitability and tax paid. Our main active compliance focus will be in the area of inappropriate tax minimisation - for example, by using inflated management fees, excessive royalty payments and tax driven financing arrangements; not recording or disguising payments for labour and other supplies; and attempts to manipulate insolvency rules such as the use of 'phoenix companies'.

    The dynamics, complexity and economic grunt of the large business segment and international transactions mean that we need to continue our concentrated attention on these taxpayers to ensure high levels of compliance with the tax laws.

    We have an extensive audit program for large corporations and high wealth individuals, collecting additional revenue of $2.64 billion over the last 5 years. This year we plan to start a further 1 000 specific issue audits and 150 comprehensive audits.

    In the international area we are focussing on the use of tax havens and profit shifting.

    While there will necessarily be some tension and hard-edged activities associated with the ATO's compliance responsibilities:

    "The future is increasingly looking like a combination of encouraging relationships between the administrator and taxpayer which are far more co-operative than adversarial - and employing a risk-based approach to compliance. Within that future there is a need to find practical administrative solutions, using best practice tools like technology to find a better way forward. Advance [Pricing] agreements are compatible with both needs - and are a practical approach integrating technology into the compliance system." 12

    Good tax administration is not about maximising revenue in the short term, but rather ensuring that the tax system itself generates expected revenues in a way that maintains community confidence. Therefore, resources have to be spread across the various market segments with a view to supporting reasonable levels of compliance in each segment. Therefore, even though the micro-business segment (small businesses with annual turnover of less than $2 m, 80% of whom have turnover accounts for less than $200 000) only accounts for about 10% of Commonwealth revenue, a significant slice of the ATO's compliance resources are directed to this market.

    A primary focus is to help and educate this segment about their obligations either through tax agents and industry associations or directly. 13 However, there will also be around 3 000 field staff conducting audits, and around one in ten micro businesses can expect to be contacted (including lodgement and debt enquiries). The ATO will undertake around 8 000 record keeping reviews to improve record keeping habits. The ATO will also follow up cases where information on activity statements and tax returns is inconsistent with previous periods or similar businesses.

    Smaller businesses often deal in cash and this increases the risk that some may not fully disclose their income.

    Design features of the new tax system provide systemic improvements to identifying and addressing risks in the cash economy. These include:

    • ABN quotation - registration requirement has drawn tens of thousands into the tax system. These businesses now need to account for past and current obligations.
    • Payer withholding when no ABN quoted - revenue protected and payee lodgement and reporting compliance checked.
    • Tax Invoices - to claim input tax credits, audit trail.
    • Reporting & Lodgement - regular activity statements, closer to real time.

    The ATO has dedicated 600 (of the 3 000) field staff to cash economy work across the various revenue products - including GST, income tax and PAYG (see Cash Economy Industry Projects Status table), with several hundred others in associated activities eg non-lodgement, debt and serious evasion (including fraud).

    Making it Easy to Comply

    The flip side to the ATO's business model is about making it easier to comply. The goal of our current efforts in this regard is summarised in the Community Relationship Model diagram.

    The ATO is undertaking the following work to deliver an improved client experience:

    ATO Online

    ATO On-Line will improve the client experience by providing the capability for taxpayers and tax agents to access on-line services and information products. This capability will also be used internally by ATO staff.

    Payment and Product Processing

    The Payment and Product Processing sub-program will develop a generic and sustainable system to:

    • Provide online access through the ATO Portal providing both interaction and certainty for taxpayers
    • Allow web services interfaces to facilitate interaction with external systems

    Accounting sub-program

    The accounting sub-program will record and treat in a consistent manner the financial interactions that a taxpayer (and its agents) have with the ATO. It will provide taxpayers and their agents with a range of transactions that enable them to update and maintain their account with the ATO.

    Inbound Contact Management sub-program

    The Inbound Contact Management sub-program will improve the client experience by creating the capability to give quick, accurate and personalised responses to telephone and other requests from taxpayers.

    Outbound Contact & Education sub-program

    The Outbound Contact & Education sub-program is seeking to personalise, consolidate and improve the quality of outbound material eg forms and letters.

    Research and Development sub-program

    The ATO is exploring partnering activities and other initiatives in the broader tax system such as:

    • integrated services using simplified business processes based on the 'natural systems' of taxpayers and intermediaries eg tax practitioners, financial institutions and software providers; and
    • simplified record keeping especially for small business.

    Improved Relationship with Tax Agents

    The 2003 Compliance Plan recognises that:

    "Registered tax agents are indispensable intermediaries in managing the community's tax system. Agents lodge 75% of the 10 million individual income tax returns and 98% of the 500 000 company returns. Agents also lodge 55% of activity statements ….The scope of recent changes in law have challenged the way tax practices have traditionally operated, with substantially increased workloads for many and a much larger number of interactions with the Tax Office each year." 14

    Agents were legitimately complaining about the ATO's telephone service. Significant efforts were made last year to provide improvements. 15 These included increasing the number of staff, streamlining access and giving agents priority, and simplifying proof of identity. Our market research indicates these improvements have been noticed and appreciated.

    We have a project, working with a group of tax agents, to re-write a number of the more disliked letters.

    We have piloted a system of providing Relationship Managers, involving telephone contact and field staff, to agents so that there is a point of escalation for problems - an internal ATO advocate for agents. Over time, these relationship managers, who are allocated to specific agents, will develop the personal link to the ATO which agents greatly appreciated in times past. The ATO is planning progressive implementation of Relationship Managers from July 2003. 16

    In relation to audit matters most complaints or disputes should be able to be resolved informally through discussion with the case officer, or involving the supervisor. Where a circuit breaker is required, tax agents are also able to escalate matters to the Tax Agent Case Resolution Service (which will be linked to the Relationship Manager initiative).

    In addition to addressing immediate irritants, it is also important to start laying the foundations of further improvements to the system.

    The implementation of the tax agents' portal is a very good example. Some 10 000 tax agents regularly use the Portal to view client information, submit online forms, and send messages to the Tax Office via secure messaging. Communication strategies are being developed to assist those tax agents not currently using the Portal and to optimise its use by all tax agents. While its introduction last October provided some immediate benefits to tax agents in terms of practice management, its real benefit lies in future developments. It provides the opportunity for real time interaction and information sharing. The ATO is currently implementing an enhanced version of the Portal (see Attachment A for a description of the new features).

    During the period July 2003 - June 2004 planned improvements to the tax agent portal include:

    • online access to view NTS and FBT accounts (single view of different accounts on screen and posting details), history of portal activity and history of transactions and core account changes;
    • ability to transfer account balances (real time - between multiple accounts - subject to demand); and
    • ability to request refunds of credit balances and receive real time response if the request is unable to be processed.

    The ATO is also talking to some of your practice management software providers about them enhancing their systems so as to provide Portal access through their packages so as to increase usability.

    The lodgement program has also been reviewed with an aim of reducing the number of lodgement events. The following administrative changes will be implemented from July 2003:

    • Extension of remittance advice arrangements (Form R) to GST instalment payers (presently only available to PAYG instalment clients)
    • Extension of remittance advice arrangements to company and superannuation fund annual PAYG income tax instalments (present requirements are for lodgement and payment)
    • Movement of eligible PAYG withholders from monthly to quarterly lodgement cycles
    • Reduction in the number of PAYG clients by changing the entry/exit tests for individuals and trusts (the current $1000 business and investment income entry test will be increased to $2000 and the balance of assessment test increased from $250 to $500), and
    • Extension of the Quarter 1,3, and 4 Activity Statement lodgement dates (ie an eight week lodgement period provided they are lodged via ELS).

    These administrative changes should achieve a reduction in the order of 700 000 lodgements each year.

    Also, Treasury consideration on the following options is being sought as they require legislative change:

    • Deferring the due date for payment of small fourth quarter PAYG income tax instalment and/or GST liabilities to the due date of the income tax assessment
    • Introducing an annual reporting and payment option for smaller GST clients, and
    • Adjusting the notional tax threshold for those clients eligible to meet PAYG income tax instalments annually and not quarterly.


    This paper has ambitiously tried to address two perspectives:


    Firstly, to provide the ATO's views on aspects of some of the topics covered or to be covered at this conference, including, consolidations, simplified imputation, and audit activities.


    Secondly, to show how the ATO is evolving and adapting to the current environment, focussing on developments in the areas of:


    Law design and implementation;


    Compliance (both help and audit) activities;


    Initiatives to improve the client experience; and


    Initiatives to improve the ATO's relationship with tax agents.

    If there is an integrating theme, it is that the ATO's approach to administering your tax system is to do so in a transparent and consultative way that enhances community confidence in its tax system.


    New and expanded functionality for the Portal will be progressively implemented from 28 April 2003. The enhanced version of the Portal will include the following new features:

    Online Forms

    • Lodgement Deferral Form - enables tax agents to submit a request for a 2 week deferral of lodgement for up to 10% of their client base due for lodgement or 10 documents (which ever is greater) and includes payment deferral.
    • Replacement Cheque Form - enables tax agents to submit a request for a replacement cheque.

    My Favourites

    • Add Favourite - provides agents with the ability to tag up to 99 of their most commonly used sites within the Portal, and to add 10 on the home page of the Portal.

    My Reports

    • Client Year to Date Summary Report - has been split into 3 different reports to provide tax agents with the ability to target information with greater ease. The 3 new reports now include:

    Year to Date Excise Revenue Product Summary Report 2001/2002

    Year to Date Excise Revenue Product Summary Report 2002/2003

    Year to Date Interest Summary Report 2001/2002

    Year to Date Interest Summary Report 2002/2003

    Year to Date Product Summary Report 2001/2002

    Year to Date Product Summary Report 2002/2003.

    • Imputation Credits Report, PAYG Instalment Notices Report and PAYG Instalment Exits Report - have been removed.

    My Messaging

    • Client Accounts - has been added as an additional topic in secure messaging to enable tax agents to query the Tax Office concerning live client accounts at their own convenience via secure email.
    • Client Details - has been added as an additional topic in secure messaging to enable tax agents to query the Tax Office concerning live client registration information at their own convenience via secure email.

    My Clients

    • Quick Search Facility - enables agents to quickly search for a client by TFN or ABN, and to select the information they would like to view for the client.
    • Live Client Account Information - provides agents with a 'live' view of account information for clients. The Integrated Client Account has the facility to view account postings, while account balances are provided for other accounts.
    • Request for Refund - this facility within the accounts screen, enables tax agents to request a transfer of funds from one account to another.
    • Request for Transfer - provides agents with a 'live' view of registration information for clients.
    • Live Client Registration Information - provides agents with a 'live' view of registration information for clients.

    The Tax Office has been undertaking a 'live' pilot with a group of 24 tax agents based in ACT and NSW. The pilot will run for 5 weeks from 10 March to 4 April 2003. The pilot will provide tax agents with the opportunity to test some of the proposed enhancements, give the Tax Office feedback on the user friendliness of some of the new features, and assist in understanding the type of support agents will need while using the Portal and how they will use the enhanced version in their practice on a day-to-day basis.

    1 Commonwealth Treasurer, Press Release, No 22 of 2 May 2002

    2 Treasurer, 'Tax Reform, not a new tax, a new tax system', 1998.

    3 Review of Business Taxation, 'A Tax System Redesigned', 1999.

    4 Treasury, 'Review of International Taxation Arrangements', 2002.

    5 Nevertheless "data suggests that Australia's recent tax reform experience has been relatively smooth compared with other countries that have undertaken taxation reforms broadly similar to those of 'The New Tax System': www.treasury.gov.au - "Preliminary Assessment of the impact of The New Tax System", 2003

    6 Ian Paroissien, quoted in PricewaterhouseCoopers, 'Tax Talk', Issue 44, 2003 at p8

    7 Note Consolidations Help lines (available on 13 24 78) and specific email link - consolidation@ato.gov.au

    8 Ideally, the legislation should be sufficiently clear to minimise areas of uncertainty, although it is acknowledged that not all factual circumstances can sometimes be contemplated in drafting the law. However, effective consultation with representative bodies during the law drafting stage can help minimise future difficulties with the practical application of tax law.

    9 If the amended assessment decreases their liability, the taxpayer is entitled to interest on overpayment.

    10 See ATO Direction: Strategic Statement 2003-05.

    11 Part 2-42 - Personal Services Income - Income Tax Assessment Act 1997.

    12 Ian Paroissien, quoted in PricewaterhouseCoopers, 'TaxTalk' Issue 44 - May 2003 p8.

    13 The ATO expects 6.8 million phone calls this year from this segment. The ATO also expects to make 50 000 advisory visits in response to requests for assistance by micro businesses. The ATO also has a range of services and products to support micro-business including e-Record, the ATO website, and Bizstart seminars.

    14 Australian Taxation Office, 'Compliance Plan 2002-03', 2002, p 12

    15 A premium phone service is in place for tax agents which aims to meet 90% of calls within 30 seconds.

    16 See minutes of ATO/Tax Practitioner Forum (ATPF) of 7 March 2003.

      Last modified: 27 Jul 2005QC 16881