4. GST compliance

We continue to enhance the management and oversight of the GST system, with an emphasis on identifying and addressing system vulnerabilities, non-compliance and emerging threats.

Registrations

GST registration is the front door to the GST system. In assisting taxpayers to correctly register for GST, we enable them to both enter and exit the GST system as required.

The number of registrations has increased in 2024–25 to over 3.5 million including 447,000 new registrants.

To maintain the integrity of the GST population we contacted taxpayers to confirm they were correctly registered and operating as an enterprise for GST purposes. This program resulted in 16,800 registration cancellations in 2024–25.

Table 4.1: GST registrations
Type	2020–21	2021–22	2022–23	2023–24	2024–25
Total GST registrants	3,080,000	3,250,000	3,320,000	3,420,000	3,514,000
Active registrants	n/a	3,164,000	3,233,000	3,329,000	3,422,000
Non-reporting registrants	n/a	86,000	87,000	91,000	92,000
New registrations	409,000	496,000	445,000	436,000	447,000
Cancelled registrations	253,000	294,000	363,000	331,000	332,000

Note: Non-reporting registrants occur where one member of a GST group manages the affairs of the group and is responsible for accounting for the GST transactions of the whole group. Each group member must be individually registered for GST to form part of the GST group. This group is included in the total number of GST registrations.

Table 4.2: Compulsory GST registrations compared to potential GST registrations (%)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
Compulsory GST registrations compared to potential GST registrations	97.2	96.9	97.2	97.3	96.9

Note: GST Performance Agreement Schedule A 5e.

Table 4.3: Total registered client base by client experience (million)
Client experience	2020–21	2021–22	2022–23	2023–24	2024–25
Small business	2.40	2.51	2.55	2.61	2.69
Privately owned and wealthy groups	0.40	0.47	0.48	0.51	0.53
Public and multinational businesses	0.08	0.08	0.08	0.09	0.09
Not-for-profit	0.07	0.07	0.08	0.08	0.07
Other	0.12	0.13	0.12	0.13	0.13
Total registered client base	3.08	3.25	3.32	3.42	3.51

Note: GST Performance Agreement Schedule A 8c.

Table 4.4: Australian Business Registry Services (ABRS) registration (%)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
Australian resident ABRS registrations finalised in 20 business days	99	99	98	99	99

Note: GST Performance Agreement Schedule A 9g. The taxpayer charter standard of 93% target applies. A change in methodology from April 2025 has enabled more up-to-date reporting of performance. It does not materially impact the calculation of our performance against this commitment. The percentile has remained steady and continued to exceed the target.

Cross-border services and goods

Non-resident businesses registered under the cross-border GST measure rose approximately 13% to slightly over 3,000 in 2024–25. Cross-border supplies of services and goods attributed nearly $1.9 billion to GST revenue this year, a 13% increase from 2023–24.

This growth reflects continued expansion in the digital economy and the effectiveness of our compliance and engagement strategies. Our active compliance program directly attributed $56 million by engaging over 200 non-resident businesses identified through our intelligence and analytics capabilities.

Notably, Table 4.5 shows this is the first year that GST from imported low value goods exceeded digital products and services. The markets of imported digital products and services and imported low value goods remain highly concentrated, with the top 10 non-resident businesses contributing 62% and 77% of the total GST revenue from each market respectively. Large non-resident entities continue to demonstrate strong compliance with Australian GST obligations.

The majority of non-resident businesses originate from the United States of America, United Kingdom, Europe, and New Zealand. Over 90% opt for simplified GST registration as a limited registration entity which does not allow them to claim GST credits. We continue to play a leading role in shaping global GST policy by participating in the Organisation for Economic Co-operation and Development (OECD) working party on consumption tax. We chair the focus group aiming to enhance international consistency in GST policy design and, support tax administrations in improving digital trade GST compliance.

Our commitment to international cooperation was reinforced by delivering training and sharing expertise with foreign tax authorities including Japan, Indonesia, and several Pacific Islands countries.

Strategic innovations which advanced our compliance program included:

launching a Special Purpose Acquisition Data program to acquire card-payment data from some Australian banks, enabling identification of non-resident businesses with unmet GST obligations
piloting AI-based technologies to assist our staff with preliminary research and profiling of non-resident entities, significantly improving productivity and risk detection
initiating preparatory work to support future multilateral audits in collaboration with the home jurisdiction of the non-resident business, with the aim of jointly investigating potential non-compliance.

These initiatives support a transformative approach to risk management, enhance operational efficiency, and ensure a level playing field between domestic and non-resident businesses.

Table 4.5: Value of cross-border services and goods ($ million)
GST value	2020–21	2021–22	2022–23	2023–24	2024–25
Imported digital products and services	700	790	815	890	925
Imported low value goods	505	565	610	755	930
Total	1,205	1,355	1,425	1,645	1,855

Note: GST Performance Agreement Schedule A 4a–b. All figures have been rounded to the nearest $5 million.

Lodgment and debt

Our focus remains to foster on-time lodgment and payment behaviours and prevent future debt by making it easier to pay. We pursue outstanding payments and demonstrate the consequences of avoiding payment obligations by:

advising those who can pay, that they must pay on time
taking firmer action for those choosing not to engage or pay
supporting those who are struggling but have the capacity to pay to get back on track
supporting those without capacity to pay to exit the system.

In October 2024, we commenced an advertising campaign educating businesses on the importance of good cash flow management habits. Additionally, we highlighted keeping GST, pay as you go withholding and superannuation separate from their cash flow. This campaign resulted in:

over 14 million impressions (the number of times the advertisements were seen)
over 78,000 clicks to our campaign landing page, which has tips to help businesses prevent a tax debt.

This advertising and supporting communications also led to this page receiving nearly 117,000 page views, a 92% increase on last year.

Lodgment

In 2024–25, on-time BAS lodgments increased by over 280,000 to 7.5 million. Total on-time lodgments continued the upward trend of the past 3 years, increasing by 1.1 percentage points.

From 2023–24, monthly and quarterly BAS lodgment results shown in Tables 4.6 and 4.7 are measured using the GST period cycle to more accurately reflect the GST reporting cycle. Prior years used the activity statement period cycle.

During 2024–25 we have maintained a focus on ensuring the integrity of the BAS lodgment population by removing entities no longer operating businesses. This has improved on-time lodgment performance and accuracy when selecting taxpayers for lodgment treatments.

Work undertaken to cancel inactive GST registrations removed approximately 32,000 outstanding BAS that were due in 2024–25 and for entities with no GST registration requirement. Small businesses accounted for approximately 78% of these cancelled BAS.

In total, over 137,000 outstanding BAS from the past 25 years were removed. This work improves non-lodgment case selection by allowing us to prioritise the highest risk to revenue cases over those without a requirement to lodge. This led to:

increased community and taxpayer engagement providing support and education on how to finalise obligations and exit the GST system to those without a genuine need to report
improved on time BAS lodgment as shown in Table 4.7
notable improvements in on-time BAS lodgment from small businesses and privately owned and wealthy groups taxpayers.

The collaborative work from our registration and lodgment areas has allowed us to maintain the integrity of the BAS lodgment population. Our continued external communications assist taxpayers who no longer require their GST and ABN registrations. This allows us to better target active entities failing to meet their lodgment obligations.

With continued external communications educating taxpayers who no longer require their GST and ABN registrations, we can target those active entities failing to meet their lodgment obligations.

Table 4.6: Total BAS lodged (%)
Type of lodgment	2020–21	2021–22	2022–23	2023–24	2024–25
Lodged (monthly)	89.9	88.9	87.3	81.9	84.7
Lodged (quarterly)	81.9	80.9	82.0	83.7	84.5
Total BAS lodged	84.1	83.1	83.4	83.4	84.5

Note: GST Performance Agreement Schedule A 5f.

Table 4.7: Total BAS lodged on time (%)
Type of lodgment	2020–21	2021–22	2022–23	2023–24	2024–25
Lodged on time (monthly)	78.5	76.1	76.3	69.0	71.8
Lodged on time (quarterly)	67.3	67.9	69.3	72.2	72.9
Total lodged on time	70.3	70.1	71.2	71.6	72.7

Note: GST Performance Agreement Schedule A 5f. BAS lodged within 7 days of the due date is regarded as lodged on time. Early BAS lodgments are also included from 2023–24.

Table 4.8: Electronic activity statements finalised within 12 business days (%)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
Proportion finalised within 12 business days	99.2	98.7	99.7	99.7	99.7

Note: GST Performance Agreement Schedule A 9c. This service commitment has a 94% target.

Table 4.9: Percentage of BAS lodged electronically (%)
BAS lodgment frequency	2020–21	2021–22	2022–23	2023–24	2024–25
Monthly remitters	92.2	93.3	94.5	94.7	95.4
Quarterly remitters	88.4	92.1	89.8	94.3	95.2
Annual remitters	95.0	95.5	95.4	96.8	97.2
Overall	88.9	92.3	90.4	94.5	95.3

Note: GST Performance Agreement Schedule A 9d.

Table 4.10: GST returns filed by intermediaries or tax agents (%)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
BAS filed by intermediaries or tax agents	56.6	56.6	58.9	59.6	60.0

Note: GST Performance Agreement Schedule A 9h.

GST debt

In the 12 months to 30 June 2025:

total ATO collectable debt increased 2.8%
GST collectable debt increased 2.3%
the ratio of GST collectable debt to GST collections (cash) was 15.0%, down from 15.6%.

The ATO Payment Strategy focusses on changing taxpayer payment behaviour and taking firmer and faster action for those who continue to not engage. We have changed our approach to collecting unpaid tax with a focus on outstanding GST amounts and are making it fairer for businesses that do the right thing. As a result, in 2024–25 the rate of GST collectable debt growth continued to slowly drop from a 2.6% increase last year to 2.3%.

As shown in Table 4.11, there has been significant growth in the value of insolvent debt since 2021–22. We expect this to continue in the future due to both ATO actions and businesses reviewing their circumstances and initiating exits.

In March 2025, we used the Commissioner’s legislative powers to shift approximately 2,000 small businesses entities from quarterly to monthly GST reporting. We targeted businesses with ongoing compliance issues that had not responded to multiple earlier interventions. It is expected this initiative will result in improved future compliance.

Table 4.11: Outstanding GST debt ($ million)
Type of GST Debt	2020–21	2021–22	2022–23	2023–24	2024–25
Total debt outstanding	10,660	12,302	15,930	17,162	18,949
Collectable debt	8,766	10,366	12,883	13,217	13,527
Insolvent debt	1,628	1,819	2,664	3,474	4,795
Disputed debt	265	117	383	471	587

Note: GST Performance Agreement Schedule A 3a. Collectable debt is debt for which there is no impediment to collection – it is not subject to objection, appeal, or to some form of insolvency administration. Due to new attribution rules for 2024–25, the sum of the debt components does not equal the total debt outstanding.

Figure 4.1 Ageing of GST collectable debt by value ($ million)

Note: Age of debt is determined by the later of the processed date or the effective date of the transactions.

Table 4.12: Ratio of collectable debt to GST revenue (%)
Type of collection	2020–21	2021–22	2022–23	2023–24	2024–25
Tax liability method (TLM) accrual	12.1	13.6	15.0	14.9	14.4
Cash	12.0	14.1	15.8	15.6	15.0

Note: GST Performance Agreement Schedule A 3b. The debt collection rate is calculated using the GST collectable debt amount as a percentage of 12 month rolling GST (TLM accrual or cash) collections.

Table 4.13: Non-pursuable GST debts
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
Percentage of GST debt non-pursuable to total GST debt	5.1	5.4	4.6	11.5	7.6
Ratio of GST debt non-pursuable to GST revenue	0.7	0.9	0.9	2.3	1.6

Note: GST Performance Agreement Schedule A 3c.

Table 4.14: GST on-time payment rate (%)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
Number of GST payments made on time	73.0	70.4	71.3	71.1	71.1
Value of GST paid on time	85.9	85.8	87.7	88.5	88.8

Note: GST Performance Agreement Schedule A 3d.

Table 4.15: Ageing of GST collectable debt – value ($ million)
Category	2020–21	2021–22	2022–23	2023–24	2024–25
<1 month	835	905	1,069	1,019	1,137
1–2 months	1,270	1,352	1,717	1,777	1,721
2–3 months	248	341	275	292	311
3–12 months	2,745	3,712	3,475	3,684	3,587
>1 year	3,668	4,056	6,346	6,444	6,771
Total GST debt value	8,766	10,366	12,883	13,217	13,527

Note: GST Performance Agreement Schedule A 3e. Age of debt is determined by the latter of the processed date or the effective date of the transaction(s).

Compliance engagement

In 2024–25, we raised $3.8 billion in liabilities through compliance activities.

We are strengthening the integrity of the GST system by enhancing our ability to detect and respond to evolving fraud and compliance risks. Our focus is on protecting revenue, supporting fair participation, and reducing opportunities for misuse.

Fraud prevention is being enhanced at key entry points like registration and lodgment through smarter systems, better data and new technologies. We are investing in advanced analytical risk models and intelligence capabilities to stay ahead of emerging behaviours and threats, strengthening the integrity of the GST system.

Our Contemporising GST Risk Model project continued to deliver modelling and system improvements to effectively manage GST compliance risks. We increased our capability to manage risks associated with multiple activity statement amendments and lodgments outside the 4-year credit time limit.

The project continues to improve analytical risk models to target risks and behaviours that impact the integrity of the GST system. Emphasis was placed on better understanding and enhancing our management of GST fraud.

Looking ahead, we are focused on identifying and addressing structural vulnerabilities to build a stronger, fairer, and more resilient GST system for the future.

Emerging threats

Digitally enabled evasion tools (DEETs), including electronic sales suppression tools (ESSTs), continue to facilitate shadow economy behaviours. Rapid advancements in e-commerce and suppression technologies have notably increased the risk by expanding this emerging threat beyond ESSTs to the broader DEETs landscape.

Modern point-of-sale systems are now integrated with online ordering applications, domestic and offshore payment platforms, linked online payment service providers and cloud-based transaction services. These integrations increase opportunities for businesses to hide or manipulate transactions and drive sales underground to evade GST and income tax. Therefore, those engaging with DEETs gain an unfair advantage over those doing the right thing.

Globally, tax jurisdictions face increasing challenges in this digital environment where DEETs and their supply chains are becoming more sophisticated, well-funded and technologically advanced. We continue to work with our domestic and international partners to evolve our treatments to address the broader digital evasion risk.

Increasingly complex attempts to defraud the GST system are proactively detected and disrupted by the ATO-led Serious Financial Crime Taskforce (SFCT). This is achieved by leveraging advanced data analytics, specialist expertise and strategic partnerships.

Our intelligence capabilities continue to reveal co-ordinated arrangements where entities conspire to illegitimately claim GST refunds. These fraudulent schemes not only compromise the fairness of the tax system but also expose participants to substantial financial and legal risk.

Despite our SFCT GST fraud warnings late last year, we continue to see related-party structuring and false invoicing used to enter into artificial and contrived arrangements.

We are concerned that businesses are indefinitely deferring or deliberately evading GST liabilities by using these arrangements to:

purport high-value acquisitions at inflated prices, giving rise to large GST refund claims
report or over report high-value transactions where the transaction either did not occur or not to the extent claimed
deliberately using services difficult to verify by vaguely describing them as project management or consultancy services.

These businesses commit fraud by claiming GST credits for acquisitions they did not make and therefore have no entitlement to. These arrangements can also provide an unfair competitive advantage when used as a form of finance.

In response, a recent targeted media engagement accompanied the release of Taxpayer Alert TA 2025/2: Arrangements designed to improperly obtain goods and services tax refunds.

These communications reinforce our commitment to transparency and early intervention in protecting the tax system from abuse. They serve as a strong deterrent urging taxpayers and advisers to:

exercise caution
seek professional advice
avoid involvement in any arrangements that may result in significant penalties or prosecution.

We will engage with partner agencies where appropriate to effectively deal with those who engage in GST fraud, false invoicing or other illegal financial arrangements. Those caught seeking to defraud the tax and superannuation systems will face the full force of the law.

Compliance liabilities

In Tables 4.18 and 4.21, the cash collection rate from client engagement activities is based on collections within the year that relate to the liabilities raised in that year only.

On the other hand, total cash collections (excluding penalties and interest) estimated within the year can also include collections that relate to compliance liabilities raised in previous years.

Table 4.16: Compliance liabilities ($ million)
Type of measure	2020–21	2021–22	2022–23	2023–24	2024–25
GST liabilities raised	2,339	5,407	4,829	2,958	3,839