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Consultation Steering Group key messages 22 July 2021

Information about the key topics discussed at the Consultation Steering Group meeting 22 July 2021.

Last updated 26 January 2022

Key highlights

Members discussed:

  • proposed consultations with updates from Treasury, the Board of Taxation and the ATO
  • the ATO’s approach to governance and prioritisation of Public Advice and Guidance
  • Practical Compliance Guidelines outlining the ATO’s approach including consultation processes
  • potential new matters for consultation and feedback on current open consultation
  • update on the ATO’s review of its website.

Introduction and opening comments

Kirsten Fish, Acting Second Commissioner, Law Design and Practice, ATO; and Michelle de Niese, Corporate Tax Association.

Co-chair Kirsten Fish opened the Consultation Steering Group (CSG) meeting and welcomed members to the second meeting for 2021.

Co-chair Michelle de Niese highlighted to members that positive discussions in relation to the agenda setting were helpful in ensuring discussions at CSG meetings were aligned with the CSG’s role and purpose, focussing on consultation activities and processes.

Michelle advised that the Chartered Accountants Australia and New Zealand representative and National Tax Liaison Group (NTLG) external Co-chair Grant Wardell-Johnson is taking up a post in London with KPMG. Michelle noted his perspective on consultation and acknowledged that Grant is a considered and inclusive Co-chair and has led some significant consultation processes. Grant has been a very valuable contributor.

Proposed consultations


Kathryn Davy, Interim CEO, Board of Taxation

A summary of Treasury consultations completed from March 2021 to June 2021 was circulated to members for their information.

Treasury has undertaken consultations on:

Kathryn Davy noted that consultation on Corporate Tax Residency is expected to occur later this year.

Members noted:

  • positive feedback on the Exposure Draft released for consultation on Implementing a reporting regime for sharing economy platform providersExternal Link noting that feedback from consultation participants was taken into consideration
  • the Government’s response (November 2020) to the Report from the independent Review of the Tax Practitioners Board (TPB) identified a number of recommendations that required further consultation. Noting that the TPB has established a new Tax Practitioners Governance and Standards Forum, members queried the status of those recommendations and next steps.
  • concerns about the roll-out of State-by-State COVID-19 support measures. This requires urgent collaboration as there are different definitions that may be used for aggregated turnover to the definitions previously established by the ATO. There is a need for the ATO and Treasury to work and assist State colleagues
  • their appreciation to Treasury for agreeing to establish working groups and for the opportunity to participate in the consultation on the Temporary Full Expensing measure.

Kathryn Davy advised that the above matters will be brought to the attention of the relevant areas in Treasury.

Kirsten Fish noted that Deputy Commissioner Deborah Jenkins has been taken offline to coordinate the ATO’s efforts in the next phase of the government stimulus response. The ATO has been working with and providing advice to NSW State based colleagues. Kirsten will provide the CSG members feedback to Deborah Jenkins.

Board of Taxation

Kathryn Davy, Interim CEO, Board of Taxation

Kathryn Davy briefed members on the Board of Taxation’s (the Board) activities, including:

  • the release of the Board’s consultation guide for the Research and Development Tax Incentive – Review of the dual-administration modelExternal Link. There is a series of proposed roundtable consultation sessions published on the Board’s website.
  • the recent announcement of a Review into the Low Value Imported GoodsExternal Link measure which facilitates the addition of Goods and Services Tax on low value imported goods. The Board is working closely and collaboratively with Treasury, the ATO and the Australian Border Force.
  • the Review of CGT roll-oversExternal Link – The Board is waiting on the Government’s direction on the way forward on general roll-overs and demergers. There are areas of complexity in relation to marriage dissolutions and small business.
  • the Tax Transparency Code has recently been raised by stakeholders. The Board provided advice to the Government last year, however, there have been increased developments in this area. The OECD’s Pillar 2 work highlights the different types of reporting that may be required in the future and it is likely the advice given to the Government is now out-of-date. Given the state of flux, it may be more suitable to update that advice next year to consider the new developments.

Members commented on:

  • the Inclusive Framework on the OECD/G20’s Base Erosion and Profit Shifting (BEPS) project – Kathryn Davy noted that the accounting profession will be critical in assisting to determine appropriate data for the accounting foundations for the proposed new rules.
  • whether there is a crossover with the work being undertaken by the Australian National Audit Office (ANAO) in relation to the Administration of the Research and Development (R&D) Tax Incentive. Kathryn Davy advised the ANAO is considering how effective the R&D concession is, reviewing compliance and efficiency of the current rules. The work the Board is undertaking has a different scope.


Andrew Orme, Deputy Chief Tax Counsel, Public Advice and Guidance (PAG), ATO

Andrew Orme noted that:

  • the Draft Taxation Determination on aggregated turnover has issues recently, and the ATO is considering further PAG on aggregated turnover issues. This includes considering advice and guidance on issues related to the connected entity test. Consultation with the Large Business and Private Groups Stewardship Groups is to occur.
  • a draft practice statement for Part 7 Penalty for Superannuation Guarantee for the post amnesty period will be released soon
  • extensive consultation has been conducted on the Taxation Ruling for sporting clubs through the Not-for-Profit Stewardship Group
  • the Draft Taxation Ruling for vacant land is expected to be released shortly – the targeted consultation process used has been very effective
  • targeted consultation on the Discussion paper on the London Interbank Offered Rate with the financial services industry is underway
  • the Draft Practice Statement on Electronic Sales Suppression Tools is close to finalisation
  • targeted consultation will be undertaken soon on the addendum to Taxation Determination TD 2012/22 concerning the share of net income of a trust estate, to take account of the Lewski decision.

Members comments:

  • Aggregated turnover – aware that Treasury may have received submissions to avoid using aggregated turnover as a test. The ATO noted that it is aware of the issue and is in discussions with Treasury.
  • Recent budget announcement in relation to the not-for-profit sector seems to indicate that there are concerns. There will be a requirement that a new form will need to be lodged next year requesting more information. Members suggested that this may require advice and guidance as it is not clear if the announcement relates to those currently reporting or to those not reporting.

Action item

CSG 2107/1

Due date

Next CSG meeting, 21 October 2021


Deputy Chief Tax Counsel, Public Advice and Guidance


Clarification of announced Budget reforms to the administration of not-for-profit entities


The ATO to clarify:

  • whether the Government’s announced reforms apply to the not-for-profit (NFP) entities who are currently reporting or to those not reporting
  • the information that will be required from NFP entities when lodging an annual self-review return
  • if the ATO is considering PAG for the proposed changes.

ATO’s approach to Public Advice and Guidance

Andrew Orme, Deputy Chief Tax Counsel, Public Advice and Guidance, ATO; Martin Pook, Public Advice and Guidance, Tax Counsel Network, ATO

The purpose of this item was for the ATO to discuss the ATO’s approach to governance and prioritisation of PAG. Andrew Orme provided a paper to members that included an overview of PAG including the role of PAG and the development and management of PAG.

Many areas of the ATO work together to produce PAG. Clarity of accountabilities and responsibilities is essential to ensure the process appropriately manages risks and achieves the desired outcome.

  • PAG Centre oversees the PAG program for the ATO. The Deputy Chief Tax Counsel for PAG is accountable for ensuring that the PAG program supports the ATO’s corporate objectives. They are also accountable for ensuring that moderate/high-risk PAG is appropriate and fulfils its intended purpose.
  • PAG Units exist in Client Engagement Group business lines and Service Delivery and are responsible for identifying and ensuring the delivery of PAG required for their relevant markets.
  • The risk owner of the relevant tax or super risk is accountable for ensuring that the PAG effectively manages the risk.
  • The Tax Counsel Network provides technical clearance for public rulings and other PAG involving significant technical issues.

The primary writing of a PAG product is usually done by staff in the Client Engagement Group supported by the Tax Counsel Network.

Other areas of the ATO who support PAG are the Consultation Hub, Digital Experience for website guidance, and Parliamentary Services with briefings to the Minister.

The Policy Analysis and Legislation business area is engaged when developing PAG for new legislation, ensuring there is appropriate liaison with Treasury. The ATO frequently consults with Treasury before a public draft is released for targeted consultation to ensure the ATO’s interpretation is aligned with Treasury’s view of the policy.

The PAG Steering Committee governs and oversees the PAG system. It is chaired by the Deputy Chief Tax Counsel, Public Advice and Guidance. The Committee does not get involved in specific PAG products.


  • Queried whether there is an overarching document that explains the products. Andrew Orme noted they are considering the development of a summary of each product type.
  • queried if there are multiple risk owners if an issue affects multiple segments. ATO advised there is usually a single risk owner, however, where issues cross different segments there is collaboration across the ATO. The PAG Centre has a key role in ensuring connections are made.
  • noted that the process often works well, however, when the process is not working well and an issue is identified, there is a challenge in knowing who to engage with to raise an issue. Andrew noted that no two products are the same as the dynamics are always different, and invited members to discuss particular cases with him to determine how they can be progressed.
  • queried whether it is possible to provide a PAG product on particular topics that are not necessarily suitable for Taxations Determinations or web guidance to ensure guidance does not fall through the cracks
  • noted there are times where dates change on the Advice Under Development page (AUDP) and this can be difficult to follow unless the reader prints out the AUDP
  • noted that the language used when summarising consultation on a draft item of PAG can suggest that there was support for the particular item when feedback received during consultation was not supportive of the draft
  • queried if the professional organisations help with the prioritisation of PAG? Andrew advised that it is important the ATO has the right input from the profession to ensure the development of the right product and input through the stewardship groups is particularly helpful.
  • queried whether there is an opportunity to explore the use of an options paper rather than a technical discussion paper or draft ruling to explore a topic and understand how different approaches on the law could be applied in practice, noting that when the ATO issues a draft it can be hard to shift thinking on the topic. Andrew indicated that he would consider this issue further.
  • asked if the ATO conducts a debriefing process after the issue of a ruling. Andrew confirmed that it has been a bit of a challenge to conduct an evaluation of rulings after they have been issued, however, it is something that that we are actively working towards.

Co-chair Michelle de Niese noted that she will coordinate a joint response to the paper provided by Andrew Orme.

ATO’s approach to Practical Compliance Guidelines

Michelle de Niese, Corporate Tax Association; Andrew Orme, Deputy Chief Tax Counsel, Public Advice and Guidance, ATO; Rebecca Saint, Deputy Commissioner, Public Groups, ATO

Members wanted to discuss the ATO processes underpinning the issue of Practical Compliance Guidelines (PCGs) and to understand what triggers the need for a PCG, if any ‘rules of consultation’ apply to PCGs, why PCGs are of a certain type, and whether they are becoming more binary.

Members noted that it appears that PCGs are the second most produced product by the ATO and that there is a growing concern about governance of this product.

The ATO noted that most taxpayers want to get it right and comply with their tax obligations. PCGs provide broad law administration guidance, addressing the practical implications of tax laws and outline the ATO’s administrative approach.

PCGs are:

  • designed to allow taxpayers to understand the likelihood of having a dispute with the ATO
  • an evolution in the ATO’s guidance program and the next step to manage compliance risk and engagement. They provide insight into how the ATO is setting its risk parameters and when it will conduct audit activities.
  • used for confidence that taxpayers will not have a dispute or enable a taxpayer to prepare for a dispute if they have a different position
  • voluntary and not mandatory to follow. There is a disclosure requirement in the Reportable tax position schedule when taxpayers self-assess. It does not require the taxpayer to apply the PCG.
  • authored in the business areas of the ATO’s Client Engagement Group. The Tax Counsel Network is engaged, with consultation a key aspect of the development of PCGs. Final approval is provided by the Deputy Chief Tax Counsel, Public Advice and Guidance, Tax Counsel Network.

Relevant topics or issues for PCGs may be identified by the ATO or raised by taxpayers and their representative bodies, industry groups, and tax professionals for consideration by the ATO, consistent with its consultation framework. PCGs are usually directed to questions that cannot be answered in a public ruling.


  • raised concerns that the benchmark for low risk is often too high which results in lots of transactions being considered medium to high risk
  • noted that even though the ATO states they are voluntary, most business will work to ensure they are in the low risk zone and see them as mandatory from a practical perspective
  • noted that consultation on proposed PCGs can be both about the interpretation of the law and the ATO’s approach to an issue. This makes it complicated and difficult.
  • identified that it is difficult where confidential or targeted consultation is conducted because it can be unclear whether the views of externals have been considered. The ATO noted that targeted consultation is undertaken with professionals who have experience in relation to the issue and the ATO provides feedback compendiums to provide an understanding of what has been considered.

The ATO invited members to provide suggestions about process improvements, noting that the Large Business Stewardship Group has taken on board the suggestion about who to include in targeted consultations. Feedback could also be provided if there is an issue about how ATO staff use and apply PCGs.

The ATO noted that we will not always agree with the views provided, but the ATO will determine its position and consider the views in doing so.

Potential new matters for consultation and feedback on current open consultation

All members

FBT working group – Members noted that the group is using a very different and unique approach to consultation. The ATO noted that Robyn Theacos will investigate the process they are using and provide feedback to the CSG.

Members were invited to provide their observations on consultation undertaken to date and suggestions that could be implemented that would improve or enhance the effectiveness of the remainder of consultation using, as examples, the following draft PCGs:

  • Draft PCG 2021/D2 – Allocation of professional firm profitsATO compliance approach
  • Draft PCG 2021/D3 – Imported hybrid mismatch ruleATO’s compliance approach
  • Draft PCG 2021/D4 – Intangibles arrangements.

Members noted that consultation is often undertaken with subject matter experts and should include practical examples. Consultation should be undertaken with taxpayers who will be impacted, not just the advisers. The ATO noted that this would depend on the market impacted. There are some cases where it is appropriate to undertake user testing.

Members suggested that where an issue is identified because of the way the law is written, it could be considered through the process noted in the ATO-Treasury Protocol. The ATO noted that generally if there are new laws and concerns are raised, the ATO will consult with Treasury so they understand the concerns and that the ATO understands the policy intent.

Update on ATO’s review of its website

Kirsten Fish, Acting Second Commissioner, Law Design and Practice

Kirsten Fish provided an update on the ATO’s review of its website, including:

  • Work is underway to procure new technology to replace the aging platform that currently sits on.
  • As part of the technology upgrade, the ATO will take the opportunity to refresh the user interface of the website.
  • Timing of new website – The ATO is currently working to confirm the delivery timeline, however, we expect a likely release of the new ATO website in late 2022. Once timelines are confirmed, we will share this information with this group.
  • User testing – The ATO has undertaken and will continue to undertake user research with all its key audience segments to inform the future design including
    • Intermediaries
    • Individuals
    • Small Business
    • Superannuation
    • Not for Profit
    • Diverse Audiences.
  • The ATO will also undertake regular small scale and randomised user testing to support design activities with a variety of audience segments.
  • The ATO is taking a user centred design approach to ensure the future will meet the needs of all our audience groups across navigation, design and content.
  • Content – The ATO understands that users of are diverse and have varied needs.
  • The ATO is reviewing and updating content using evidence including user centred research. The ATO’s website vision is ‘ will help make it easy to understand and meet Australian tax and super obligations'.
  • Lack of visibility of updates to the ATO’s website – This is a known issue the ATO aims to address through improved technical functionality of the future project. Due to technical limitations with the current website, there is no option to automatically provide this additional information.
    • The ATO has captured this as one of the requirements for the new technology.
    • When the new platform is confirmed, and the ATO understands what the new technology can deliver, the ATO will consider the solution design. This would then be tested with users.

Members queried if this information can be shared with other groups and associations. Kirsten noted that this information will be provided to the Tax Practitioners Stewardship Group to consider.

Action item

CSG 2107/2

Due date

As soon as possible


CSG Secretariat


Update on ATO’s review of its website


The CSG secretariat to provide the update on the ATO’s review of its website to the ATO Chair of the Tax Practitioners Stewardship Group to consider.

Action items update

Robyn Theacos, Director, Consultation Hub; ATO

A status update was provided on the following open CSG action item.

CSG 2007/01 – Draft Practical Compliance Guidance on Professional firms – allocation of profit guidelines and Everett assignment

The status update noted that following further consultation with the working group in late 2020, the draft Practical Compliance Guideline was published for public consultation on 1 March 2021.

Members agreed to close action item CSG 2007/01.

Members commented that there is a need to provide the professional associations with educational products. The ATO noted it will investigate what educational products are being proposed.

Action item

CSG 2107/3

Due date

Next CSG meeting, 21 October 2021


Deputy Chief Tax Counsel, Public Advice and Guidance


ATO proposed educational products for Professional Firms Practical Compliance Guideline


The ATO to investigate what educational products are being proposed for the professional associations in relation to the Professional Firms Practical Compliance Guideline.

Other business

ATO Stewardship Groups Co-chairs meeting insights

A meeting of the ATO Stewardship Co-chairs was held on 25 March 2021 chaired by Kirsten Fish. The key messages from the meeting were circulated in the meeting papers to CSG members for their information.

Key points to note:

  • An overview was provided of discussions held at the 25 February CSG meeting.
  • The ATO Co-chairs noted discussions held at their relevant stewardship groups.
  • Feedback from the External Co-chairs on best practice approaches was provided to the stewardship group secretariats.


The following reports were tabled at the meeting for members’ information:

  • ATO consultation activities – February to June 2021
  • Feedback on consultation activities – February to June 2021
  • Snapshots of the Stakeholder Relationship and Special Purpose working groups as at 30 June 2021.

Any other business


  • asked how the updates for the website on Section 100A and Division 7A Unpaid Present Entitlements are progressing. The ATO noted there has been a great amount of work and consultation undertaken.
  • provided positive feedback on the consultation process conducted by Assistant Commissioner Judy Morris on the top 1,000 governance guide
  • noted that the CSG has not had an external independent member for some time.

Kirsten Fish updated members on movements of several ATO senior executive officers noting in particular:

  • Andrew Orme will temporarily transfer to the role of Deputy Commissioner, Review and Dispute Resolution at the start of August following the resignation of Jeremy Geale. Andrew has been a key member of the CSG and has progressed improvements to processes for public advice and guidance products. It has not yet been announced who will take over Andrew’s role as Deputy Chief Tax Counsel, Public Advice and Guidance.
  • This was the last CSG meeting for Louise Clarke who will be transferring into the role of Deputy Commissioner, Private Wealth. Louise has been a valuable member of this group for many years including in her roles in Public Advice and Guidance and in Policy Analysis and Legislation. Louise has greatly influenced the consultation processes the ATO undertakes in relation to new legislation. We thank Louise for her significant contributions to the CSG.

Members thanked Louise Clarke for her contribution, engagement and efforts including with her work in relation to the Commissioner’s Remedial Power.


Attendees list




Kirsten Fish (Co-chair), Law Design and Practice


Andrew Orme, Public Advice and Guidance


Georgina Wade, Enterprise Strategy and Design


Louise Clarke, Policy Analysis and Legislation


Robyn Theacos, Enterprise Strategy and Design

Board of Taxation

Kathryn Davy

Chartered Accountants Australia and New Zealand

Michael Croker

Corporate Tax Association

Michelle de Niese (Co-chair)

CPA Australia

Elinor Kasapidis

Institute of Public Accountants

Tony Greco

Law Council of Australia

Angela Lee

Tax practitioner

Keith Clissold

The Tax Institute

Julie Abdalla


Apologies list



Association of Superannuation Funds of Australia

Glen McCrea