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Large Business Stewardship Group key messages 1 June 2023

Key messages from Large Business Stewardship Group key messages 1 June 2023.

Last updated 17 August 2023

Client Engagement Group realignment

The ATO informed members of the recent realignment to Client Engagement Group (CEG). These changes ensure the ATO is best positioned to respond to the government’s additional funding to expand the Tax Avoidance Taskforce (TAT) and a number of priority ATO programs, that was announced in last year’s Federal Budget.

Key changes to note for Large Business Stewardship Group (LBSG) members include:

  • Public Groups is now a stand-alone business line with two Deputy Commissioners: Client Experience led by Deputy Commissioner Rebecca Saint; and a new Deputy Commissioner role of Engagement led by Acting Deputy Commissioner Faith Harako.
  • International will expand and become its own stand-alone business line known as International, Support and Programs led by Deputy Commissioner Hector Thompson. This business line will be responsible for our international programs and organisation of the major programs we deliver for the ATO: TAT and GST programs, and GST technical leadership.

Compliance risk and emerging issues

The ATO informed members of emerging issues relevant to large businesses through an update on the expanded Taskforce work programs.

Next Actions program

Approximately 10% of assurance reviews currently result in a referral to the Next Actions program. We continue to see some cases moving directly to audit from the Combined assurance review. Better identification of issues that can be resolved by taxpayers has seen a decrease in cases needing ATO intervention.

Members discussed the complexities of large corporate structures, internal systems and governance, and that it would be helpful for ATO staff to better understand large business operations when engaging taxpayers during compliance or assurance activity. Members discussed capability development for tax officers across ATO and large corporates to improve the integrated client and staff experience during engagement activities.

Action item


Due date

23 August 2023


All LBSG members

Action item details

Members to provide feedback on their or their clients’ experience with the Next Actions program to


Action item


Due date

23 August 2023


Michelle Sams

Action item details

Members to consider capability development for tax officers across ATO and large corporates to improve the integrated client and staff experience.

Foreign acquisition

The vast majority of foreign investment applications have been assessed as involving low risk from a tax perspective. A very small amount (under 2%) has been assessed as having a high risk. We are concerned when an aggressive and potentially tax driven structure is implemented or where a taxpayer fails to comply with Foreign Investment Review Board disclosure obligations.

Central management and control test of residency

The ATO intends to set out the Commissioner’s risk assessment framework for the central management and control test of residency in an Appendix to Practical Compliance Guideline Practical Compliance Guideline PCG 2018/9 Central management and control test of residency: identifying where a company's central management and control is located to supplement the existing Practical Compliance Guideline and Taxation Ruling 2018/5. The update will be published before 30 June 2023 and will be consistent with our administration of this issue to date. While there is expanded content, the update does not change our approach or how we assess risk on this issue.

The update will assist all foreign-incorporated companies to better understand what the ATO sees as low risk circumstances under the central management and control test where the Commissioner wouldn’t apply his compliance resources. Moderate and higher risk circumstances are also addressed.

Finalisation of Capitalised labour advice and guidance

The ATO updated members of the finalisation of Taxation Ruling TR 2023/2 Income tax: application of paragraph 8-1(2)(a) of the Income Tax Assessment Act 1997 to labour costs related to the construction or creation of capital assets. This is the finalised version of Draft Taxation Ruling TR 2019/D6 Income tax: application of paragraph 8-1(2)(a) of the Income Tax Assessment Act 1997 to labour costs related to the construction or creation of capital assets.

The ATO has not seen an increase in disputes around this issue since the draft was released.

Advance pricing arrangement program review

The ATO informed members of the outcomes from the Advance pricing arrangement (APA) program review.

  • The review focused on how to improve the overall client experience, program efficiency and prospective tax certainty to encourage cooperative compliance.
  • APAs are most suitable for clients seeking certainty for transfer pricing, particularly for significant transactions. The APA Program will ensure effective management of transfer pricing and collateral issues.
  • The review set out eight recommendations, with a particular emphasis on APA entry criteria, treatment of collateral issues, and mutual obligations between program participants and the ATO.

Members discussed whether there would be any changes to the retrospective rollback application of an aged APA. The ATO confirmed that the recommendations would not have any impact on rollbacks so long as the APA is concluded in a mutually acceptable manner. We noted there are limits to rollbacks and that the ATO would not like to see a 5-year rollback and no prospective years covered, as that would be inconsistent with the APA program’s intent.

Members expressed interest in seeing a stand-alone review report along with any updated web guidance. The ATO agreed to explore whether the report could be published in a stand-alone document.

Tax Counsel Network

ATO Chief Tax Counsel informed members of key stakeholders in Tax Counsel Network (TCN) and provided the update on key public rulings and upcoming priorities for TCN.

Governance of public advice and guidance (PAG) was discussed. The ATO clarified that the Chief Tax Counsel has oversight of all ATO public advice and guidance with PAG units led by Assistant Commissioners within each business line, having a focus and coordinating role specific to their market.

TCN are looking to improve timeliness of release of key products including guidance on new law. Web content advising ATO’s Advice under development program is being reviewed and updated to remove outdated content and show current advice matters only, with timely status updates and clear contacts.


All members expressed support for good policy and acknowledged the current environment including change of government last year. LBSG members provided feedback to the ATO and Treasury on recent Treasury consultation processes for new measures announced in last year’s Budget. Members discussed elements that could be improved for future consultation:

  • timeframe to be adequate for the complexity and significance of new law being proposed
  • clarity on critical changes and articulation of specific issues would be helpful to provide tailored feedback
  • clear processes to support interested parties to provide considered feedback that is sensitively managed and upholds integrity of consultation processes.

Some members expressed interest for earlier engagement for future consultation.

Both the ATO and Treasury reiterated an openness to feedback and that feedback is taken on board as relevant, including where it can help to improve the process for all involved. Treasury noted their priority to balance delivering on election commitments and existing formal processes.


Treasury provided an update on their forward work program and Organisation for Economic Co-operation (OECD) Two-Pillar Solution.

In response to members’ queries, Treasury informed members about delegated legislation, which is part of the broad range of legislative tools that are available to implement the government’s taxation policy. Delegated legislation can allow for a faster and more flexible legislated response to emerging challenges. New delegated legislation must also be accompanied by an explanatory statement that explains the operation and function of the new law, and an explanation of why the new power is necessary.

OECD Two-Pillar Solution

The government announced as part of the 2023-24 Budget that it will implement a 15% global minimum and domestic minimum tax for large multinational enterprises commencing 1 January 2024. Both taxes are key components of Pillar Two. Australia continues to be actively engaged in ongoing negotiations to finalise remaining aspects of the two pillars.

Pillar One

The OECD’s focus is on the drafting of the Multilateral Convention (MLC) while resolving outstanding policy issues for both Amount A (reallocation of profits) and Amount B (simplified transfer pricing).

The OECD’s current timeline aims to have the MLC for Amount A finalised and opened for signature in mid-2023. It will enter into force after a critical mass of jurisdictions have ratified it.

The work on Amount B is also progressing with a view to completion in mid-2023. Australia has committed significant resources to the Amount B project.

Pillar Two

The Inclusive Framework has released the Model Rules (the GloBE Rules) and an Implementation Framework. The OECD have revised expectations for the GloBE Rules to be adopted from 2024 onwards. The government’s announcement is consistent with this timeline.

Treasury is working closely with teams at the Office of Parliamentary Counsel and the ATO on domestic implementation in Australia. It is important for Australia’s legislation to produce outcomes consistent with the GloBE Rules, and to be seen as ‘qualified’ under the peer review process.

The ATO noted significant work is underway and any questions about the administration of the global minimum tax and domestic minimum tax can be sent to

Board of Taxation

Tax treatment of digital assets and transactions

The Board has held an extensive public consultation process with stakeholders for the Taxation of digital assets and transactions review.

The Board has engaged with international revenue authorities and is supported by a working group of subject matter experts from the tax profession, academia and industry along with representatives from the ATO and Treasury.

The Board has developed a draft taxation principles framework to support the government in creating, designing, and implementing tax policy responses to current and future problems in the tax treatment of crypto assets and transactions. The draft framework has been presented to the Working Group and continues to be refined.

The report is due to the Treasurer by 30 September 2023.

ATO consultation process with large market

Integrity declarations

The ATO tabled the draft integrity declaration with LBSG members. The integrity declaration is mandatory for all members of all ATO stewardship groups as a part of our governance processes and risk management controls.

Members discussed the draft content. The ATO noted it is currently undergoing revisions at the National Tax Liaison Group (NTLG). Members agreed to revisit once the next iteration becomes available for discussion.

LBSG Charter

Further to discussions from the March meeting, the updated Large Business Stewardship Group (LBSG) Charter was shared.

Other business

The ATO updated members on the Top 100 Justified Trust program and engagement with Top 100 high assurance taxpayers, including further guidance on refresh reviews.

The ATO informed members of current processing delays and that we have made some internal adjustments to prioritise the backlog. A recent Business bulletin article highlighted updated Available services for Australia's largest taxpayers which shows channels for progressing large business enquiries. Members discussed how the processing delays are impacting large corporates and acknowledged other markets are more severely impacted. The ATO committed to providing a further update at our next meeting on changes to improve the client experience and service offering for large business taxpayers.


Attendees list




Rebecca Saint (Co-chair), Public Groups


Faith Harako, Public Groups


Hector Thompson, International, Support and Programs


Melissa Spurge, Public Groups


Michael Ingersoll, Public Groups


Michelle Sams, Public Groups

Australian Banking Association

Darren Norman

Australian Petroleum Production and Exploration Association

Michael Fenner

Australian Retirement Trust

Ian Roberts

BHP Billiton

Premila Roe

Big 4 representative

Cindy Perryman


Irene Filippone

Business Council of Australia

Pero Stojanovski

Corporate Tax Association

Michelle de Niese (Co-chair)

Law Council of Australia

Adrian Varrasso


Megan Williams

Tax Institute of Australia

Pete Rhodes


Marty Robinson

Guest attendees

Guest attendees list




Fiona Dillon, Office of the Chief Tax Counsel


Kate Wilson, Enterprise Strategy and Design


Sarah Hassen, Public Groups


Vy Tran, Public Groups


Apologies list



Board of Taxation

Michelle Calder

Group of 100

Marc Lewis


Angela Giunta

Property Council of Australia

Kelly Wong

South 32

Brian Purdy


Diane Brown