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  • Motor vehicle registries data matching program protocol

    1 Data matching guidelines

    Attention

    Warning:

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

    End of attention

    The Australian Taxation Office (ATO) has committed itself to voluntarily comply with the Guidelines on data matching in Australian Government administrationExternal Link (2014) (Guidelines) published by the Office of the Australian Information Commissioner (OAIC).

    The Motor vehicle registries data matching program protocol is prepared and published in accordance with these guidelines.

    2 Overview

    The Motor vehicle registries data matching program has been developed to assess the overall taxation compliance of individuals and businesses involved in buying and selling motor vehicles. The ATO will match the data provided by the state and territory motor vehicle registering authorities against the ATO’s taxpayer records with the objective of identifying those who may not be meeting their registration, reporting, lodgment and payment obligations.

    3 Purpose and objectives

    Purpose

    The overall purpose of the data matching program is to identify and address non-compliance with taxation obligations.

    Objectives

    The objectives of the Motor vehicle registries data matching program are to:

    • obtain intelligence about taxpayers that buy and sell motor vehicles to identify risks and trends of non-compliance with taxation and superannuation obligations
    • identify and address taxpayers buying and selling motor vehicles who may not be meeting their obligations to register and lodge returns (including activity statements) and ensure the correct reporting of income and entitlement to deductions and input tax credits
    • use the motor vehicle purchaser’s data as an indicator of risk, along with other data holdings, to identify taxpayers that have purchased vehicles with values that are not commensurate with the income they have reported
    • identify cases for investigation of taxpayers of interest, such as sellers, licenced dealers, fleet managers, leasing companies or representatives of these taxpayers to determine if the use of interposed proxy ownership is used to conceal the real accumulation of wealth, therefore representing a material threat to public revenue
    • promote voluntary compliance and strengthen community confidence in the integrity of the taxation system by publicising the conduct of this data matching program
    • identify and deal with those taxpayers who may not have met their obligations with regards to GST, fringe benefits tax, luxury car tax, fuel schemes and income tax
    • generally ensure compliance with registration, lodgment, correct reporting and payment of taxation and superannuation obligations.

    The ATO is seeking to obtain external data to cross-reference with its own internal data to identify relevant cases for administrative action.

    Details will be requested from the state and territory motor vehicle registering authorities where their records indicate a vehicle has been transferred or newly registered during the 2013-14, 2014-15 and 2015-16 financial years where the purchase price or market value is equal to or exceeds $10,000. This threshold was determined taking into account car prices have fallen over the past decade and new vehicles can now be purchased around this amount.

    This data will allow compliance checks on luxury car tax, fringe benefits tax and fuel schemes, as well as identifying higher risk taxpayers with outstanding taxation lodgments and those with undeclared income.

    4 Agencies and entities involved

    Matching and primary user agency

    The ATO is the matching agency, and will generally be the sole user of the data. In very limited and specific circumstances as contained in Division 355 of Schedule 1 to the Taxation Administration Act 1953, the ATO may provide individual records to other agencies, including state and territory revenue authorities and law enforcement agencies.

    The data matching program will be conducted on the ATO’s secure computer facilities and in accordance with approved policies and procedures.

    Source entities

    Source entities data will be obtained from

    State/territory

    Motor vehicle registration authority

    Australian Capital Territory

    Office of Regulatory Services

    Justice and Community Safety Directorate

    New South Wales

    Roads and Maritime Services

    Northern Territory

    Department of Lands and Planning

    Queensland

    Department of Transport and Main Roads

    South Australia

    Department of Planning, Transport and Infrastructure

    Tasmania

    Department of State Growth Resources – Registration and Licencing Branch

    Victoria

    VicRoads Licencing and Registrations Operations

    Western Australia

    Department of Transport

    In accordance with Guideline 5.9 the ATO has also advised the source agencies to take reasonable steps to notify the general public of their participation in this data matching program.

    5 Data issues

    Data elements

    The ATO will obtain the following data items from the source agencies for the 2013-14, 2014-15 and 2015-16 financial years where motor vehicles were sold/transferred or newly registered and the transfer and/or market value is $10,000 or greater:

    • details of the purchasers, sellers, licenced dealer, fleet manager, leasing company (or representative of any of these) and the registering person for an unincorporated body, including
      • name – individual
      • name – business (legal and trading)
      • address (including postcode) – residential, business (for legal notices), postal (for renewals)
      • date of birth – individual
      • contact phone number
      • Australian business number (if applicable)
      • Australian company number (if applicable).
       

    Based on experience from previous data motor vehicle registries matching programs, the majority of transactions involve only a single seller and single buyer.

    • Transaction details will include
      • date of transaction
      • type of transaction (for example, new registration, transfer)
      • sale price of the vehicle
      • market value of the vehicle
      • vehicle’s garage address
      • type of intended vehicle use (for example, private, business)
      • vehicle make
      • vehicle model
      • vehicle body type
      • year of manufacture
      • engine capacity or number of cylinders
      • tare weight (unladen weight)
      • gross weight (gross vehicle mass and/or gross combination mass)
      • vehicle identification number (chassis number)
      • registration number
      • transaction receipt number
      • state stamp duty exemption (yes or no)
      • reason for state duty exemption
      • dealer’s licence number.
       

    A full copy of the data dictionary is included in Appendix A.

    Number of records

    It is estimated that the total number of transactional records that will be obtained is 2 million per annum, identifying approximately 2.8 million individuals (some transactions will involve more than one individual).

    Data quality

    The ATO works collaboratively with the motor vehicle registries to ensure that any request for data are reasonable in terms of both costs of providing the data and systems capability.

    Based on previous Motor vehicle registries data matching programs, the ATO is confident the data will be of good quality. The states and territories have their own financial and legislative incentives to maintain accurate records.

    Data will be transformed into a standardised format and validated to ensure it contains the required data elements prior to loading to ATO mainframe systems.

    Data integrity

    The ATO has a mature identity matching engine, Client Identification Compliance system (CIDC). This ensures a high confidence in the integrity of the identity matching as the system utilises more than one identifier in the matching process. For example, where an Australian business number (ABN), name, address and date of birth are available all fields are used in the identity matching process. Very high confidence matches will occur where all fields are matched.

    Some data is anticipated to be matched at lower confidence levels where there are not matches on all fields, or there is missing data or differences in the data.

    Where administrative action is proposed, additional checks will take place to ensure the correct entity has been identified. The entities will be provided the opportunity to verify the accuracy of the information before any administrative action is taken.

    Data security

    ATO staff are subject to the strict secrecy and privacy provisions contained in Division 355 of Schedule 1 to the Taxation Administration Act 1953 and include terms of imprisonment in cases of serious contraventions of these provisions.

    All ATO systems are strictly controlled, with features including:

    • system access controls and security groupings
    • login identification codes and password protection
    • full audit trails of data file and system accesses.

    The ATO will utilise its secure online Data Transfer Facility to obtain the data from source agencies.

    6 Discrepancy matching

    Matching process

    The identity matching process is described above under Data integrity, and is the first step in the matching process.

    Records with a sufficient confidence level in the identity match will be loaded the ATO’s secure data warehouse where data analysts will use various techniques to identity potentially high risk discrepancy matches for actioning within compliance areas. Cases selected for administrative action will be loaded to mainframe case management systems for allocation to compliance staff.

    Lower risk discrepancy matches will be further analysed and a decision taken to either take some form of compliance or educational activity, or to destroy the dataset.

    Quality assurance

    Quality assurance processes are integrated into ATO processes and systems and are implemented throughout the data matching cycle.

    These assurance processes include:

    • registering the intention to undertake a data matching program on a central register and approvals being obtained from the Data Matching Gatekeeper and Senior Executive Service (SES) officers prior to any activity being undertaken
    • conducting program pilots or obtaining sample data to ensure the data matching program will achieve its objectives prior to full data sets being obtained
    • notifying OAIC of our intention to undertake the data matching program and any intentions to vary from the data matching guidelines
    • maintaining access management logs recording details of who has access to the data, why access is required and how it will be used
    • quality assurance processes embedded into compliance activities.

    These processes ensure data is collected in accordance with the ATO’s data management policies and principles, and complies OAIC’s data matching guidelines.

    7 Previous programs

    This data matching program has been ongoing since the 2003-04 financial year, with data being collected on an annual basis. Each year the data has supported compliance strategies in relation to identifying omitted income. The data is used in conjunction with other income assessing risk models and profiling tools to generate compliance activities.

    The Motor vehicle registries data matching program continues to be effective and the ATO intends to continue the data matching programs for the 2013-14, 2014-15 and 2015-16 financial years.

    8 Action resulting from the program

    A taxation compliance risk profile of taxpayers buying, selling or acquiring motor vehicles will provide information to the ATO to:

    • deliver products and tailored education strategies to assist taxpayers in managing their taxation obligations
    • identify taxpayers at risk of not complying with their taxation obligations to be referred to the relevant area within the ATO for appropriate remedial action.

    Before any administrative action is taken, taxpayers will be provided with the opportunity to verify the accuracy of the information obtained by the ATO. Taxpayers will generally be given at least 28 days to respond before administrative action is taken.

    For example, where discrepancy matching identifies that a taxpayer is not reporting all of their income, but in fact they are reporting the income under another entity, the taxpayer will be given the opportunity to clarify the situation.

    The data may also be used to ensure that taxpayers are complying with their other taxation and superannuation obligations, including registration requirements, lodgment obligations and payment responsibilities.

    In cases where taxpayers fail to comply with these obligations, even after being reminded of them, escalation for prosecution action may be instigated in appropriate circumstances.

    Where a taxpayer has correctly met its obligations, the use of the data will reduce the likelihood of contact from the ATO.

    9 Time limits applying to the program

    We are seeking to have the Privacy Commissioner exercise her discretion and allow the ATO to vary from the data destruction requirements contained in the Guidelines.

    The collection of data under this program protocol is expected to occur in the period July-December each financial year.

    The ATO is seeking to retain the data for a period of five years after collection on the basis that its retention is required for the protection of public revenue.

    The data is used in multiple risk models, including models that establish retrospective profiles over a number of years. Destroying the data in accordance with the Guidelines will reduce the effectiveness of these models.

    Data is managed and destroyed in accordance with the requirements of the Guidelines and the National Archives of Australia's General Disposal Authority 24 - Records relating to Data Matching Exercises.

    See Appendix B – Variation to guidelines setting out the basis for seeking this variation to the data destruction guidelines and its impacts on individual privacy.

    10 Public notice of the program

    The ATO will publish a public notification of this data matching program in the Federal Register of Legislation – Gazettes in the week commencing 15 December 2014. A copy of the Gazette notice will be provided to the data providers and the OAIC. A copy of the proposed Gazette notice is included in Appendix C.

    The ATO will also publish a copy of this data matching program protocol on its website once the Gazette notice has been published.

    Data providers have been advised they may also notify their clients of participation in this data matching program, and they are considering their options.

    11 Relationship to lawful functions

    The Commissioner of Taxation has responsibility for ensuring taxpayers meet their taxation and superannuation obligations. Compliance with these obligations is a matter the ATO takes seriously and a failure to address non-compliant behaviour has the potential to undermine community confidence in the integrity of the taxation and superannuation systems and the ATO’s capacity in administering those systems.

    The ATO’s data matching program is one of the strategies used to identity and deal with non-compliant behaviour. Data matching programs provide a degree of assurance that the taxpayers are meeting their obligations.

    12 Legal authority

    ATO legislation

    The data will be obtained under the ATO’s formal information gathering powers contained in the following legislative provisions:

    • Section 264 of the Income Tax Assessment Act 1936
    • Section 353-10 of Schedule 1 to the Taxation Administration Act 1953 (administering indirect taxes)
    • Section 128 of the Fringe Benefits Tax Assessment Act 1986
    • Section 77 of the Superannuation Guarantee (Administration) Act 1992.

    These are coercive powers that obligate the data providers to furnish the information requested. The ATO will use the information for taxation and superannuation compliance purposes.

    Privacy Act

    This use is within the limits on the use of personal information imposed by Australian Privacy Principle 6 (APP6) contained in Schedule 1 of the Privacy Act 1988 and in particular:

    • APP6.2(b) – the use of the information is permitted by an Australian Law, and
    • APP6.2(e) – the use is necessary for the ATO’s enforcement related activities.

    13 Alternative methods

    The ATO has considered a range of alternatives to this data matching program to ensure entities are complying with their taxation and superannuation obligations. Relying only on data already held by the ATO is of limited value for the following reasons:

    • The ATO only receives data from taxpayers that are correctly registered and meeting their lodgment obligations.
    • The ATO has no other data to cross-reference against to ensure taxpayers are reporting their obligations correctly other than by directly contacting every taxpayer.
    • Industry classification records are of limited value, particularly in situations where a taxpayer may conduct more than one business activity, and the industry under examination in this data matching program is not the primary business activity of the taxpayer.

    This data matching program will allow the ATO to identify taxpayers that may be operating outside the taxation and superannuation systems. It will also reduce the likelihood of the ATO unnecessarily contacting a taxpayer that is complying with their taxation obligations.

    Data matching is an effective and efficient method of examining records of thousands of taxpayers to ensure compliance with lodgment and reporting obligations that would otherwise be a resource intensive exercise examining records individually.

    It also assists the ATO effectively promote voluntary compliance by notifying the public of areas and activities under scrutiny, despite some negative perceptions toward data matching.

    This is an ongoing data matching program that has proven effective for more than a decade.

    14 Costs and benefits

    Benefits

    The main benefits of conducting this data matching programs include:

    • Integrity of the taxation and superannuation systems – there are inherent risks in taxpayers not complying with their obligations, including those that deliberately abuse these systems – this program will assist the ATO in detecting, dealing with and deterring those that are not meeting their obligations.
    • Reduce risks to taxation revenue by identifying those that may be operating outside the taxation system.
    • Enabling enforcement activity and recovery of taxation revenue – identifying taxpayers that may not be complying with their taxation obligations and correcting that behaviour – without undertaking this data matching program and subsequent compliance activity there are no assurances that a wider risk to revenue does not exist.
    • Maintaining community confidence in both the taxation and superannuation systems by creating a level playing field, and also maintaining community confidence in the ATO’s capacity to fairly administer those systems.

    Costs

    There are some incidental costs to the ATO in the conduct of this data matching program, but these will be more than offset by the total revenue protected:

    • costs associated with obtaining and storing the data
    • data analyst resources to identify potential instances of non-compliance
    • compliance resources to manage casework and educational activities
    • governance resources to ensure that the Guidelines and Privacy Act are complied with, and quality assurance work to ensure the rigour of the work undertaken by analysts and compliance staff.

    Appendix A – Data dictionary

    Specifications for MV 2014 data

    File format – text FIXED length

    File one – Transaction information

    Character position

    Field name

    Format

    Description

    1–20

    TRANS_RECEIPT_NUMBER

    CHAR (20)

    (left justified, blank filled)

    Receipt number of transaction – enables chronology where more than one transaction per vehicle is recorded on one date.

    21–28

    TRANS_DATE

    CHAR (8)

    Transaction date – year, month and day – yyyymmdd.

    29–53

    TRANS_TYPE

    CHAR (25)

    (left justified, blank filled)

    Transaction type – either:

    • ‘New Registration’, or
    • ‘Transfer Registration’
     

    54–65

    SELLER_CRN

    CHAR(12)

    (left justified, blank filled)

    Seller Customer Reference Number – unique identifier which identifies the seller’s registration details. This information will enable linking to the customer file.

    66–77

    PURCHASER_CRN

    CHAR(12)

    (left justified, blank filled)

    Purchaser Customer Reference Number– unique identifier which identifies the purchaser’s registration details. This information will enable linking to the customer file.

    78–87

    PURCHASE_PRICE

    CHAR (10)

    (right justified, zero filled)

    Amount vehicle sold for.

    88–97

    MARKET_VALUE

    CHAR (10)

    (right justified, zero filled)

    Market value of vehicle at time of transaction.

    98–175

    VEH_USAGE_TYPE

    CHAR (78)

    (left justified, blank filled)

    Vehicle usage eg private, business, taxi, charter, ambulance.

    176–205

    MAKE_OF_VEHICLE

    CHAR (30)

    (left justified, blank filled)

    Make of vehicle eg Ford, Holden, Kenworth.

    206–260

    MODEL_OF_VEHICLE

    CHAR (55)

    (left justified, blank filled)

    Model of vehicle eg Land-cruiser, RX7, Golf.

    261–264

    YEAR_OF_MANUFACTURE

    CHAR (4)

    (right justified, zero filled)

    Year only – yyyy

    265–342

    BODY_TYPE

    CHAR (78)

    (left justified, blank filled)

    Body type eg Caravan, Hatchback, Sedan, Horse-float, Van.

    343–347

    ENGINE_CAPACITY

    CHAR (5)

    (right justified, zero filled)

    Size of engine.

    348–351

    NO_OF_CYLINDERS

    CHAR (4)

    (right justified, zero filled)

    Number of cylinders.

    352–357

    TARE_MASS

    CHAR (8)

    (right justified, zero filled)

    The weight of an empty vehicle or container.

    358–367

    GCM_OR_GVM

    CHAR (8)

    (right justified, zero filled)

    (only used if the GVM and GCM cannot be separated).

    368–375

    GVM

    CHAR (8)

    (right justified, zero filled)

    Gross Vehicle Mass – maximum weight that a truck can carry including its own weight.

    376–383

    GCM

    CHAR (8)

    (right justified, zero filled)

    Gross Combination Mass – total weight a truck can carry or tow.

    384–403

    VIN_CHASSIS

    CHAR (20)

    (left justified, blank filled)

    Vehicle identification number.

    404–413

    REGISTRATION_NUMBER

    CHAR (10)

    (left justified, blank filled)

    Plate details.

    413–416

    STAMP_DUTY_EXEMPT_INDICATOR

    CHAR (3)

    (left justified, blank filled)

    Stamp duty exemption:

    Was the vehicle exempted from payment of stamp duty?

    Was stamp duty $0?

    Either ‘yes’ or ‘no’

    417–471

    STAMP_DUTY_EXEMPT_REASON

    CHAR (55)

    (left justified, blank filled)

    If the above response is ‘yes’ – what is the reason for the exemption eg beneficiary of will, gift – parent to child, spouse to spouse, benevolent institution or not known.

    If the above field is ‘no' – this field is left blank.

    472–475

    GRG_ADD_POST_CD

    CHAR (4)

    (right justified, zero filled)

    The postcode of the vehicle’s garage address.

    476–575

    GRG_ADDR

    CHAR (100)

    (left justified, blank filled)

    Garage address of vehicle.

    File two - Customer information

    Character position

    Field name

    Format

    Description

    1–12

    CRN

    CHAR(12)

    (left justified, blank filled)

    Customer reference number (CRN) – an identifier unique to the legal owner of the vehicle. This field is used to populate the purchaser and seller CRN fields in the transaction table.

    13–42

    SRNM

    CHAR (30)

    (left justified, blank filled)

    The surname of an individual – legal owner of vehicle.

    43–57

    FIRST_NM

    CHAR (15)

    (left justified, blank filled)

    The first given name of an individual – legal owner of vehicle.

    58–87

    OTHR_GVN_NM

    CHAR (30)

    (left justified, blank filled)

    The second given name of second given initial of an individual.

    88–163

    FULL_NM

    CHAR (76)

    (left justified, blank filled)

    The name of a non-individual entity, ie business name/legal name of entity – legal owner of vehicle.

    164–171

    BRTH_DATE

    CHAR (8)

    (left justified, blank filled)

    Birth date for an individual – yyyymmdd.

    172–175

    RES_ADDR_POST_CD

    CHAR (4)

    (right justified, zero filled)

    The postcode of the customer’s address.

    176–275

    RES_ADDR

    CHAR (100)

    (left justified, blank filled)

    Address of customer.

    276–286

    RPT_ID_NUM

    CHAR (11)

    (right justified, zero filled)

    An ACN or ABN.

    287–362

    TRADING_NM

    CHAR (76)

    (left justified, blank filled)

    Trading name of customer.

    363–366

    BUS_ADD_POST_CD

    CHAR (4)

    (right justified, zero filled)

    The postcode of the customer’s business address.

    367–466

    BUS_ADDR

    CHAR (100)

    (left justified, blank filled)

    Business address of customer if different address to above.

    467–470

    POST_ADDR_POST_CD

    CHAR (4)

    (right justified, zero filled)

    The postcode of the customer’s postal address.

    471–570

    POST_ADDR

    CHAR (100)

    (left justified, blank filled)

    Postal address of customer if different address to above.

    571–590

    CONTACT_PHONE

    CHAR (20)

    (left justified, blank filled)

    Customer’s contact phone number.

    591–600

    DEALERS_LIC_NUM

    CHAR (10)

    (left justified, blank filled)

    Dealer licence number of the customer.

    601–603

    DEALER_INDICATOR

    CHAR (3)

    (left justified, blank filled)

    QLD, NT and SA only. Is the customer a motor vehicle dealer – either ‘yes’ or ‘no’

    WA only – “D” = dealer.

    Appendix B – Variation to guidelines

    The Australian Taxation Office (ATO) is seeking approval for the Motor Vehicle Registries 2013-14 to 2015-16 financial years data matching program to vary from one or more of the conditions detailed in Guideline 10 of the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian Government administration (2014) (the Guidelines).

    In December 2014 the Motor Vehicle Registries 2013-14 to 2015-16 data matching program was granted exemption to retain the data for three years from the receipt of all verified data files from the providers. To accommodate period of review we are seeking an increase of a further two years, taking the total period to retain data to five years from receipt of all verified data files from data providers. The ATO considers that a variation from the usual retention periods for this data matching program is in the public interest as:

    • The discrepancy matching that occurs under parts of this program is iterative in nature. For example one discrepancy match may be used in subsequent and different matching processes. This process can typically occur over multiple financial years.
    • The data is also used in multiple risk models, including models that establish retrospective profiles over a number of years. Destroying the data in accordance with the Guidelines will reduce the effectiveness of these models.
    • Destruction of the data would inhibit the ATO’s ability to identify taxpayers who may be subject to administrative action and therefore result in loss of public revenue.
    • Retaining data for five years supports our general compliance approach of reviewing an assessment within the standard period of review.

    Whilst increased data retention periods may increase privacy risks, we have implemented a range of safeguards to appropriately manage and minimise any increased risk.

    This program will continue to be subject to an evaluation within three years which is consistent with the requirements of Guideline 9.

    Additional information justifying this variation is included in the tables below:

    • Table 1 – Matters considered in accordance with Guideline 10.2 in seeking this variation
    • Table 2 – Consistency with the requirements of the remaining Guidelines
    • The ATO does not request that this request be kept confidential (Guideline 10.6) and has no concern should the Office of the Australian Information Commissioner place this information on its website.
    Table 1 – Matters considered in accordance with Guideline 10.2 in seeking this variation

    Matter considered

    Consideration

    10.2.a – The effect of not abiding by Guidelines would have on individual privacy

    • Retaining data for a period of five years will not materially affect the risk to the privacy of an individual. We have implemented a range of safeguards to appropriately manage and minimise any increased risk, including secure processes for handling and storing data. Once acquired, all data will be stored on our secure computer systems where access is strictly controlled and full audit logs maintained.
    • The ATO and our staff operate under stringent confidentiality and privacy legislation that prohibits the improper access to or disclosure of protected information. These obligations are supported by significant penalties, including imprisonment. This substantially mitigates the risks of breaches of individual privacy.
     

    10.2.b – The seriousness of the administrative or enforcement action that may flow from the data matching program

    • An extension of the retention period will not affect the seriousness of the administrative action that may flow from the match, but will assist in detecting non-compliance or taxation fraud.
    • Where we propose to take administrative action where a taxpayer may have reported incorrectly, we will differentiate between those that try to do the right thing and those that set out to deliberately avoid their obligations. Documented procedures, including the Taxpayers’ Charter and compliance model will be followed to ensure fairness and consistency.
     

    10.2.c – The effect that not abiding by the Guidelines would have on the fairness of the program – including its effect on the ability of individuals to determine the basis of decisions that affect them, and their ability to dispute those decisions

    • There will be no effect on the fairness of the program or the ability of taxpayers to find out the basis of decisions that impact them or their ability to dispute those decisions.
    • Before any administrative action is undertaken, taxpayers will be given at least 28 days to verify the accuracy of the information that has been derived from this data matching program.
    • Where administrative action is taken, we will adhere to the principles established in the Taxpayers’ Charter and compliance model will to ensure an equitable and consistent approach is taken.
    • If a taxpayer does not agree with an assessment, they maintain the right to dispute the decision. They also have the legal right to appeal against those decisions through the tribunals and the courts.
     

    10.2.d – The effect that not abiding by the Guidelines would have on the transparency and accountability of agency and government operations

    • There will be no adverse effect on the transparency and accountability of government operations.
    • We published a notice with general information about the Federal Register of Legislation – Gazettes prior to administrative action commencing. We will also update our program protocol available on our website.
     

    10.2.e – The effect that not abiding by the Guidelines would have on compliance of the proposed data matching program with the Australian Privacy Principles in the Privacy Act 1988

    • There will be no effect on compliance with the Australian Privacy Principles contained in Schedule 1 to the Privacy Act 1988 due to a longer retention of the data. The data is collected for the stated objectives established in the data matching program protocol.
     

    10.2.f – The effect that complying with the Guidelines would have on the effectiveness of the proposed data matching program

    • The effectiveness of the program would be reduced if the data retention period is not extended.
    • There would be a significant reduction in our ability to detect incorrect reporting and taxation fraud without assessing trends in the data collected.
    • The destruction of the data in accordance with the current guidelines would impact the integrity of the taxation system by
      • limiting the ATO’s ability to identify taxpayers who may be subject to administrative action
      • resulting in the loss of public revenue.
       
     

    10.2.g – Whether complying fully with the Guidelines could jeopardise or endanger the life or physical safety of information providers or could compromise the source of information provided in confidence

    • Not abiding by all the requirements of the Guidelines would not influence or affect the personal safety of any individual identified as part of the program or compromise the source of the information provided in confidence.
     

    10.2.h – The effect that complying fully with the Guidelines would have on public revenue – including tax revenue, personal benefit payments, debts to the Commonwealth and fraud against the Commonwealth

    • Not allowing the variation to the data retention period of the program would cause us to miss potential breaches of taxation laws and subsequent non-payment of tax. This would result in the Commonwealth foregoing taxation revenue.
    • There are risks to the integrity of taxation system when people fail to comply with their obligations. Abiding by all of the requirements of the Guidelines will reduce the effectiveness of proposed compliance activity. We would miss the opportunity to educate those taxpayers trying to do the right thing, and deter those that are non-compliant from repeating the behaviour.
    • The effect of abiding by all of the requirements in the guidelines could negatively impact both public revenue and the confidence the public and government have in the ATO as an administrator of the taxation system. People not complying with their taxation obligations, including those operating outside the system, set a bad example to complaint taxpayers and may encourage their non-compliance. Maintaining community and government confidence in the taxation system is critical to our on-going role.
     

    10.2.i – Whether complying fully with the Guidelines would involve the release of a document that would be an exempt document under the Freedom of Information Act 1982

    • Upon receipt of a freedom of information request only information relating to the taxpayer’s own affairs will be released to the taxpayer concerned.
     

    10.2.j – Any legal authority for or any legal obligation that requires, the conduct of the proposed data matching program in a way that is inconsistent with the Guidelines

    • There is no specific legislative power authorising the conduct of this program inconsistent with the Guidelines.
    • The Commissioner of Taxation, or his authorised representative, has formed the opinion that this data is required to enable us to effectively and efficiently carry out its legislated functions under the general powers of administration contained in
      • Section 3A of the Taxation Administration Act 1953
      • Section 8 of the Income Tax Assessment Act 1936
      • Section 1-7 of the Income Tax Assessment Act 1997
      • Section 356-5 in Schedule 1 of the Taxation Administration Act 1953.
       
    • The reasons for proposing to operate outside requirements of the Guidelines are detailed above.
     

    This section outlines where the ATO is consistent with the requirements of the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian Government administration (2014).

    Table 2 – Consistency with the requirements of the remaining Guidelines

    Paragraph/Guideline

    Action taken/to be taken

    Para 6 – Status of the Guidelines

    Our committed to complying with the Guidelines is embedded in our data management policies and principles and clearly stated in the chief executive instruction.

    Guideline 1 – Application of the Guide

    We apply the guidelines for all data matching programs where it is anticipated the program will include records of 5,000 or more individuals.

    We recognise that programs where there are multiple data sources with common objectives and algorithms are treated as a single data matching program.

    Guideline 2 – Deciding to carry out or participate in a data matching program

    We conduct a cost-benefit analysis and consider alternate methods prior to proposing to conduct a data matching program.

    Further, the ATO has rigorous governance arrangements, processes and system controls in place to protect the privacy of individuals.

    Guideline 3 – Prepare a program protocol

    Prior to conducting a data matching program, we prepare a data matching program protocol, submit this to the Office of the Australian Information Commissioner and make a copy publicly available on our website.

    When elements of a data matching program change, the protocol is amended a copy of the amended protocol provided to the Office of the Australian Information Commissioner and updated on our website.

    Guideline 4 – Prepare a technical standards report

    Documentation is prepared and so as to satisfy the requirements for a technical standards report.

    Guideline 5 – Notify the public

    We publish notification of our intention to undertake data matching program in the Federal Register of Legislation – Gazettes prior to the commencement of the program.

    This notice will include the following information as required by the Guidelines:

    • a brief description of the objectives of the data matching program
    • the matching agency and source entities involved in the data matching program
    • a description of the data contained in the data set involved in the data matching program
    • the categories of individuals about whom personal information is to be matched
    • the approximate number of individuals affected
    • reference to our privacy policy.

    Notification of the program is also published on the ATO’s website and data providers are advised they can advertise their participation in the data matching program.

    Guideline 6 – Notify individuals of proposed administrative action

    Prior to taking any administrative as a result of the data matching program, individuals and other entities are given at least 28 days to verify the accuracy of the information provided to us by third parties.

    Guideline 7 – Destroy information that is no longer required

    We are seeking to vary from this requirement.

    Guideline 8 – Do not create new registers, datasets or databases

    We do not create new registers or databases using data obtained in the course of a data matching program.

    Guideline 9 – Regularly evaluate data matching programs

    Programs are evaluated within three years of the commencement of the data matching program. These evaluations are provided to the Office of the Australian Information Commissioner on request.

    Guideline 10 – Seeking exemptions from Guideline requirements

    When we intends to vary from the requirements of the Guidelines we seek the approval of the Office of the Australian Information Commissioner and provide documentation to support the variance.

    Guideline 11 – Data matching with entities other than agencies

    We undertake our own data matching programs This function is not outsourced.

    Where data is obtained from an entity other than an individual, we usually do so using our formal information gathering powers. In these instances the entities are advised they are able to notify their clients of their participation in the data matching program.

    Guideline 12 – Data matching with exempt agencies

    We do not usually undertake data matching with agencies that are exempt from the operations of the Privacy Act 1988 under section 7 of that Act and that are subject to the operation of the Guidelines (ie any data matching undertaken with an exempt agency would usually be for fewer than 5,000 individuals).

    In the event a data matching activity would otherwise be subject to these Guidelines except for the exemption status, we still adhere to the principles of the Guidelines and prepare a program protocol, seeking to vary from the Guidelines by not publicly notifying of the program and publishing the protocol. We would still lodge a copy of the protocol with the Office of the Australian Information Commissioner.

    Guideline 13 – Enable review by the Office of the Australian Information Commissioner

    We would not prevent the Office of the Australian Information Commissioner from reviewing our data matching activities and processes. These activities and processes have been reviewed by the Australian National Audit Office and Inspector-General of Taxation.

    Appendix C – Gazette notice

    Commissioner of Taxation

    NOTICE OF A DATA MATCHING PROGRAM

    The Australian Taxation Office (ATO) will acquire details of entities from State and Territory motor vehicle registries for the 2013-2014, 2014-2015 and 2015-2016 financial years from the following sources:

    State/territory

    Motor vehicle registration authority

    Australian Capital Territory

    Office of Regulatory Services

    Justice and Community Safety Directorate

    New South Wales

    Roads and Maritime Services

    Northern Territory

    Department of Lands and Planning

    Queensland

    Department of Transport and Main Roads

    South Australia

    Department of Planning, Transport and Infrastructure

    Tasmania

    Department of State Growth Resources – Registration and Licencing Branch

    Victoria

    VicRoads Licencing and Registrations Operations

    Western Australia

    Department of Transport

    It is estimated that records of 2 million transactions will be obtained, enabling the identification of approximately 2.8 million individuals.

    The ATO will obtain the following data items from the source agencies for the each of the financial years where motor vehicles were sold/transferred or newly registered and the transfer and/or market value is $10,000 or greater:

    • Details of the purchaser(s), seller(s), licenced dealer, fleet manager, leasing company (or representative of any of these) and the registering person for an unincorporated body, including:
      • name – individual
      • name – business (legal and trading)
      • address (including postcode) – residential, business (for legal notices), postal (for renewals)
      • date of birth – individual
      • contact phone number
      • Australian business number (if applicable)
      • Australian company number (if applicable)
       
    • Transaction details will include:  
      • date of transaction
      • type of transaction (eg. new registration, transfer)
      • sale price of the vehicle
      • market value of the vehicle
      • vehicle’s garage address
      • type of intended vehicle use (eg. private, business)
      • vehicle make
      • vehicle model
      • vehicle body type
      • year of manufacture
      • engine capacity or number of cylinders
      • tare weight (unladen weight)
      • gross weight (gross vehicle mass and/or gross combination mass)
      • vehicle identification number (chassis number)
      • registration number
      • transaction receipt number
      • state stamp duty exemption (yes or no)
      • reason for state duty exemption
      • dealers licence number.
       

    These records will be electronically matched with certain sections of ATO data holdings to identify non-compliance with registration, lodgment, reporting and payment obligations under taxation laws.

    This program is called the Motor vehicle registries data matching program and its purpose is to identify and address non-compliance with taxation obligations. Its objectives are to:

    • obtain intelligence about taxpayers that buy and sell motor vehicles to identify risks and trends of non-compliance with taxation and superannuation obligations
    • identify and address taxpayers buying and selling motor vehicles who may not be meeting their obligations to register and lodge returns (including activity statements) and ensure the correct reporting of income and entitlement to deductions and input tax credits
    • use the motor vehicle purchaser’s data as an indicator of risk, along with other data holdings, to identify taxpayers that have purchased vehicles with values that are not commensurate with the income they have reported
    • identify cases for investigation of taxpayers of interest, such as seller(s), licenced dealers, fleet managers, leasing companies or representatives of these taxpayers to determine if the use of interposed proxy ownership is used to conceal the real accumulation of wealth, therefore representing a material threat to public revenue
    • promote voluntary compliance and strengthen community confidence in the integrity of the taxation system by publicising the conduct of this data matching program
    • identify and deal with those taxpayers who may not have met their obligations with regards to GST, fringe benefits tax, luxury car tax, fuel schemes and income tax
    • generally ensure compliance with registration, lodgment, correct reporting and payment of taxation and superannuation obligations.

    A document describing this program has been prepared in consultation with the Office of the Australian Information Commissioner. A copy of this document is available:

    The ATO complies with the Office of the Australian Information Commissioner’s The use of data matching in Commonwealth administration – guidelines (2014) which includes standards for data matching to protect the privacy of individuals. A full copy of the ATO’s privacy policy can be accessed at www.ato.gov.au/privacy

      Last modified: 07 Aug 2019QC 43255