• Schedule A: Performance outcomes

    Table 1 - Maintain compliance

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Revenue outcome

    GST revenue (cash)

     

     

     

     

    Total cash

    $46.0b

    $48.1b

    $51.1b

     

    Customs cash (net)

    $3.1b

    $3.0b

    $3.2b

    Collections were stronger in 2013–14 than in 2012–13 reflecting recovery of growth in consumption subject to GST since the global financial crisis. This is consistent with growth in consumption and dwelling investment.

     

    Decorative graph: provides a visual representation of the GST revenue outcome figures already provided for the past three financial years.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    GST debt

    GST debt outstanding

     

     

     

     

    Total

    $5.1b

    $4.8b

    $5.1b

     

    Collectable

    $3.5b

    $3.6b

    $3.6b

     

    GST debt collection rate

    7.6%

    7.6%

    7.0%

    Collectable debt is debt that is not subject to objection or appeal or to some form of insolvency administration. Despite growth in GST revenue and increased debt inflow, the level of collectable debt was maintained in 2013–14. The profile of GST collectable debt in 2013–14 is consistent with the previous year.

    Decorative graph: provides a visual representation of the GST total and collectable debt figures already provided for the past three financial years.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    Interest paid on delayed refunds

    $15.7m

    $4.7m

    $2.6m

    Interest paid on delayed refunds has reduced due to improved performance over time with timely release of refunds.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    GST debt non-pursuit

     

     

     

     

    Value $

    $886.8m

    $1,455.8m

    $918.1m

     

    Percentage

    19.2%

    28.7%

    19.0%

    GST debt non-pursuit refers to debt that is irrecoverable at law or uneconomical to pursue and is influenced by both the number and average value of cases. The value of GST debt non-pursuit in 2013–14 was $918.1 million. This is 36.9% less than the level in 2012–13, where the average case value of GST debt non-pursuit was uncharacteristically high. Around 62% of the 2013–14 GST debt non-pursuit related to debts irrecoverable at law. These debts were mainly limited to circumstances associated with insolvency.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    Ageing of GST debt – number of cases

     

     

     

     

    <30 days

    13,059

    41,146

    39,813

     

    <60 days

    75,706

    75,168

    77,995

     

    <90 days

    50,190

    12,988

    10,565

     

    >90 days

    329,476

    192,770

    194,762

     

    Total

    468,431

    322,072

    323,135

     

    Decorative graph: provides a visual representation of the ageing of GST debt by number of cases for 2013-14 - figures already provided.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    Ageing of GST debt – value

     

     

     

     

    <30 days

    $191.7m

    $464.0m

    $381.3m

     

    <60 days

    $513.2m

    $477.7m

    $500.0m

     

    <90 days

    $279.6m

    $131.9m

    $125.9m

     

    >90 days

    $2.4b

    $2.3b

    $2.4b

     

    Total

    $3.4b

    $3.4b

    $3.4b

    The number of debt holdings cases aged greater than 90 days has remained stable, but has increased in value.

     

    Decorative graph: provides a visual representation of the ageing of GST debt by their value for 2013-14 - figures already provided.

    Table 1 - Maintain compliance (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    Core indicator

     

     

     

    Trend over time in GST gap

     

     

     

     

    Estimated GST gap value $

    $3.16b

    $3.14b

     

    Excluding debt - percentage of accrual revenue

    6.2%

    6.0%

     

    Including debt - percentage of accrual revenue

    7.5%

    7.2%

    Notes

    • GST gap data is provided one year in arrears due to the timing of national accounts data releases.
    • The estimated GST gap for 2012–13 is $3.14 billion without debt. This is 6.0% of theoretical GST revenue.
    • The results are consistent with the 2011–12 GST gap estimate. The GST gap analysis is most useful when viewed on a trend basis rather than as an absolute measure. The GST gap has trended downwards since the introduction of the GST and remained broadly consistent over the past few years. This provides assurance that at a macro level, compliance levels are being maintained over time.
    Table 2 - Compliance outcomes

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Compliance outcomes

    Strike rate

    48%

    70%(a)

    75%(b)

    Notes

    1. The increase in the strike rate from 2011–12 to 2012–13 was due to improved targeting of cases associated with the cash economy risk. The strike rate in 2011–12 was influenced by higher volumes of lodgment work which has a lower strike rate.
    2. The increase in strike rate from 2012–13 to 2013–14 is due to improved targeting of cases associated with the property risk.

    Strike rate figures exclude business activity statement (BAS) refund compliance activities.

     

    Decorative graph: provides a visual representation of the GST strike rate figures already provided for the past three financial years.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Compliance outcomes

    Compliance liabilities raised

    $2.3b

    $2.3b

    $3.4b

    The 2013–14 compliance liabilities results include three significant one-off cases totalling $433 million and one complex case to the value of $482 million. However, if these ‘outliers’ were excluded, compliance liabilities raised would be $2.5 billion which is in line with previous years. The dollar amount of penalties (including general interest charge and shortfall interest charge) are not included.

    Decorative graph: provides a visual representation of the GST compliance liabilities raised figures already provided for the past three financial years.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Compliance outcomes

    Voluntary disclosure large market

     

     

     

     

    Number

    152

    223

    196

     

    Value $

    $235m

    $234m

    $293m

    We encourage large business to implement good tax governance, and to self–review and self-amend their BAS if errors are identified. This financial year was the first full year of GST Determination (GSTE 2013/1) regarding the levels of self-correction of GST errors. This may have contributed to the reduction in the number of voluntary disclosures. However, the average value of disclosures has increased. Our early engagement and client relationship management programs are aimed at influencing voluntary compliance.

     

    Decorative graph: provides a visual representation of the GST voluntary disclosure in the large market figures already provided for the past three financial years.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2009-10

    2010-11

    2011–12

    2012–13

    Core indicator

     

     

     

     

     

    Compliance outcomes

    Percentage of compulsory GST registrations compared with potential GST registrations based on income tax returns data

    95.9%

    95.9%

    96.0%

    96.1%

    Performance has remained unchanged over the last four years. The indicator compares the number of entities that declare business income in excess of $75,000 in their income tax returns with the number of compulsory GST registrants. The ratio measures the level of community participation in the GST system. Performance against this indicator is reported one year in arrear due to reliance on corresponding income tax data.

    Decorative graph: provides a visual representation of the GST Percentage of compulsory GST registrations compared with potential GST registrations based on income tax returns data graph figures already provided for the past three financial years.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Compliance outcomes

    BAS lodgment

     

     

     

     

    % lodged

     

     

     

     

    - monthly

    91.1%

    91.3%

    91.5%

     

    - quarterly

    87.0%

    87.3%

    87.5%

     

    % lodged on time

     

     

     

     

    - monthly

    79.7%

    80.0%

    80.5%

     

    - quarterly

    75.7%

    75.8%

    76.1%

    Improved effectiveness of lodgment compliance action has contributed to gradual improvements in lodgment performance over the last two years.

     

    Decorative graph: provides a visual representation of the BAS lodgment figures already provided for the past three financial years by lodged monthly, lodged quarterly, lodged on time monthly, and lodged on time quarterly.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    Audit coverage

     

     

     

     

    International benchmark (2005)

    Average 5.85%, range 0.6% to 27.7%

    83.1%

    50.0%

    38.5%

    Audit coverage is calculated as the total number of client contact cases conducted in any one year divided by the population of GST registered clients. For improved transparency, the audit coverage rate for the years 2012–13 and 2013–14 includes an adjustment for cases where a client may have had more than one contact from the ATO. This adjustment was not made in the preceding years.

    High client contact targets were set in the first three years of the ‘Working together to improve voluntary compliance’ program associated with a focus on lodgment reminders. In 2013–14, the emphasis shifted towards enforcement case work and more direct contact with taxpayers with a GST debt resulting in the lower audit coverage rate for 2013–14. The trend in reduced audit coverage is in line with the ATO’s differentiated and tailored risk treatments.

    Table 2 - Compliance outcomes (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicator

    Objection rate

    12.9%

    10.8%

    7.7%

    The lower objection rate in 2013–14 is the direct result of our early engagement and improved communication approach with taxpayers at the audit and review stage. We received 42% fewer objections in 2013–14 than in 2012–13 from our audits.

    Table 3 - Cost effective administration

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Cost effectiveness

    Cost as a % of revenue

     

     

     

     

    International benchmark (2007)

    Average 1.22, range 0.82 to 1.53

    1.51%

    1.47%

    1.35%

    The cost as a percentage of revenue has reduced to 1.35%. In 2013–14, for each $100 we collected, it cost $1.35. The lower cost of GST administration combined with an increase in GST revenue collected has reduced the overall ratio in 2013–14.

    Decorative graph: provides a visual representation of the cost as a percentage of revenue figures already provided for the past three financial years.

    Table 3 - Cost effective administration (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Cost effectiveness

    Cost per registrant

     

     

     

     

    International benchmark (2007)

    Average $410, range $157 to $527

    $254

    $262

    $261

    The cost per registrant is $261. There was a decrease in both the cost of GST administration and the number of GST registrants in the year.

    The calculation is based on total administration costs divided by the total registered active GST client base. Changes to either variable can affect the cost per registrant. The ‘Working together to improve voluntary compliance’ additional funding in the years 2010–11 to 2013–14 has increased GST administration costs and affected the cost per registrant over the last four years.

     

    Decorative graph: provides a visual representation of the cost per registrant figures already provided for the past three financial years.

    Table 3 - Cost effective administration (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Operational and cost management

    Variation of GST administration costs

     

     

     

     

    from agreed estimate

    2.0%

    –1.6%

    1.2%

     

    total admin estimate

    $683.2m

    $694.4m

    $698.6m

    The GST administration cost preliminary end-of-year result is within 1.2% of the original estimate. The lower cost from agreed estimate was the result of workforce adjustments across the ATO to manage the budget in line with the Australian Public Service agenda of improving productivity and reducing costs.

    Table 3 - Cost effective administration (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Core indicator

     

     

     

     

    Operational and cost management

    Compliance costs as a % of total admin costs

    43.9%

    41.8%

    44.8%

    The higher ratio is due to increased investment in active compliance and compliance intelligence and risk management activities.

    Decorative graph: provides a visual representation of compliance costs as percentage of total administration cost figures already provided for the past three financial years.
    Table 3 - Cost effective administration (continued)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Supplementary indicators

    Electronic activity statements(a) – finalised in 12 business days

    98%

    99%

    99.8%

    Objections to assessments(b) – finalised in 56 calendar days of receiving all necessary information

    97%

    97%

    98%

    Written technical advice

     

     

     

    - taxpayer requests actioned in 28 calendar days(c)

    85%

    93%

    93%

    - private rulings are finalised in 28 calendar days of receiving all necessary information(d)

    94%

    97%

    95%

    Telephone general enquiry service – general calls answered within five minutes

    84%

    81%

    79%

    Business activity lodgment method – % of BAS lodged electronically

     

     

     

    - overall

    56.5%

    58.9%

    61.6%

    - monthly remitters

    51.9%

    54.7%

    58.5%

    - quarterly remitters

    57.0%

    59.3%

    62.0%

    - annual remitters

    66.1%

    67.4%

    67.0%

    Quality of technical advice - % of cases that passed

    93%

    100%

    94%

    The quality of technical advice is measured against several criteria (administrative soundness, correctness, transparency, consistency, efficiency, integrity, appropriateness, effectiveness and timeliness). We met the benchmark (71%) for the year.

    Australian resident ABR registrations – finalised in 20 business days

    98.0%

    90.4%

    99.0%

    Notes: In 2013–14, we transitioned from taxpayer charter service standards to service commitments. The above supplementary indicators reflect the new service commitments which are also contained in the GST administration performance agreement 2014–15 to 2016–17.

    Previously the indicators were reported as:

    1. BAS processing – refunds issued within 14 days
    2. objections to assessments – response within 56 days
    3. written technical advice – response to general correspondence in 28 days
    4. response to private rulings in 28 days.
    Table 4 - Australian Customs and Border Protection Service (ACBPS)

    Key outcome

    Measure

    2011–12

    2012–13

    2013–14

    Management of GST revenue collection

    GST liability assessed

    $25.56b

    $26.00b

    $27.31b

    GST collected

    $3.16b

    $3.15b

    $3.36b

    Maintain compliance

    Costs of import and export compliance

    $32.0m

    $32.7m

    $31.5m

     

    The item ‘Active compliance costs’ for 2011–12 and 2012–13 has been restated to include tourist refund scheme (TRS) costs as well as costs of import and export compliance, in accordance with GST Administration Performance Agreement (2014). Previously TRS costs had been omitted. This also affects the compliance yield calculations.

    ACBPS pre-clearance intervention and post transaction verification functions are key treatments for a wide range of border risks, including revenue leakage. Revenue leakage can occur through undervaluation, misclassification and non-declaration of goods, and false claims for GST exemptions, preferential treatment under free trade agreements and duty refunds and concessions.

     

    Compliance coverage – imports

    9.9%

    6.3%

    8.8%

     

    Compliance coverage – exports

    8.3%

    2.2%

    0.8%

     

    ACBPS previously identified a data-integrity issue that involved the unintended compounding of Customs value (CVAL) in the compliance coverage figure. ACBPS rectified that compounding issue from financial year 2012–13 but ACBPS has no capacity to correct earlier financial year data. Accordingly, it is not meaningful to compare compliance coverage in 2012–13 and 2013–14 with coverage figures in earlier financial years.

     

    Audit coverage – tourist refund scheme

    100%

    100%

    100%

     

    Tourist refund scheme claims rejected

    3.0%

    3.1%

    3.6%

     

    GST adjustments – underpaid GST revenue

    $27.3m

    $151.5m

    $80.1m

     

    For the financial year 2013–14, ACBPS compliance activities identified a total of $80.1 million in GST understatements. This is a decrease of 47% or $71.4 million when compared with the 2012–13 financial year. However, if we remove two significant 2012–13 outliers (understatements of $82 million and $23 million), there is an increase of approximately 75% or $34 million in 2013–14 compared to 2012–13. We can attribute the increase, in part, to our tougher stance on non-compliant behaviour and better targeting.

     

    GST adjustments – rejected tourist refund scheme claims

    $2.5m

    $3.4m

    $3.4m

     

    Total GST adjustments

    $29.8m

    $154.9m

    $83.5m

     

    Compliance yield

    0.93:1

    4.73:1

    2.65:1

    Cost-effective administration

    Costs of import processing

    $22.3m

    $20.9m

    $22.7m

     

    Costs of export processing

    $0.5m

    $0.3m

    $0.3m

     

    Costs of import and export compliance

    $17.6m

    $19.3m

    $18.6m

     

    Costs of administering the tourist refund scheme

    $14.4m

    $13.4m

    $12.9m

     

    Total costs

    $54.8m

    $54.0m

    $54.5m

     

    Import declarations processed

    3.6m

    3.6m

    3.8m

     

    Export declarations processed

    1.3m

    1.2m

    1.4m

     

    Total tourist refund scheme claims processed

    537,058

    581,317

    671,564

     

    Total ACBPS administration costs remain fairly constant. TRS claims processing represents the most significant challenge for the ACBPS in this area, with take-up of the scheme increasing significantly faster than growth in the number of departing passengers. During 2013–14 there was a 13% increase in the number of TRS claims (8% in 2012–13) and a 14% increase in the value of TRS claims (16% in 2012–13), compared with departing passenger numbers rising by approximately 5% each year.

     

    Total costs as a % of total GST liability assessed

    0.2%

    0.2%

    0.2%

     

    Total costs as a % of total GST collected

    1.7%

    1.7%

    1.6%

    Notes: 2013–14 values are preliminary and subject to revision and finalisation of the 2013–14 financial statements and Australian National Audit Office (ANAO) special purpose audit review. Final values for the full year will be reported in the ACBPS 2013–14 Annual Report.

    ACBPS undertakes a review of the costing methodology used in developing import processing charge (IPC)/GST costs every two years. The last review has resulted in minor refinements to the methodology and 2010–11, 2011–12 and 2012–13 results. Some prior year figures in this report may therefore differ from those previously published.

      Last modified: 22 Dec 2014QC 43515