Opening comments
No conflicts of interest were raised.
ATO Strategy
The ATO Strategy 2026-30 has been released, providing a clear direction for how the ATO will evolve to support and administer the tax system over the coming years and working with partners across the ecosystem. It outlines 5 strategic shifts that will shape the future role of the ATO, with implementation details to be developed through a forthcoming roadmap. Members welcomed the strategy and acknowledged the feedback adopted from earlier consultation, particularly on language, clarity and role of partners. Members welcomed the ambition of the strategy while recognising the need for disciplined prioritisation and informed investment decisions in a constrained operating environment.
The ATO emphasised the importance of shift 4, which seeks to move towards deeper partnership and shared stewardship across the tax system. This includes stronger collaboration with intermediaries and digital partners. Members supported more consistent and deliberate approaches to partnering, with the ATO proposing a standing agenda item within stewardship groups to identify red tape reduction opportunities across the tax system. Members welcomed the proposal and the potential role of the National tax Liaison Group (NTLG) in helping to assess and prioritise opportunities, while emphasising the importance of focusing on meaningful and achievable outcomes.
Test case litigation program
The ATO provided an update on refinements to the Test Case Funding Program. The revised criteria clarify when public funding will be granted, introducing a clearer eligibility framework, and making program purpose and thresholds more explicit. This includes incorporating considerations previously reflected as expectations into a more structured eligibility test.
Funding decisions will continue to be informed by an independent external panel and assessed on merit, focusing on resolving significant legal uncertainty rather than supporting particular outcomes or appeals.
Members welcomed the clearer articulation of the program’s purpose and eligibility requirements, particularly the explicit focus on objectives and thresholds. Discussion focused on how funding decisions are applied in practice, including consistency in supporting High Court appeals and whether decisions vary depending on the outcome of earlier proceedings. We confirmed that funding decisions are not outcome-based but are driven by unresolved legal uncertainty and broader system significance. Members also noted the importance of transparency and consistency in decision-making, with no automatic entitlement to funding at any stage.
Special case management pilot
The ATO outlined a pilot case management approach for a small number of strategically significant matters from the Public Groups and Private Wealth case pools. The pilot introduces a more deliberate, whole-of-pipeline approach to case management, including a senior oversight panel across the life of a matter, continuity of legal expertise, and enhanced handover arrangements between business areas.
The pilot operates within existing ATO guidelines and does not change decision-making responsibilities. It is intended to improve coordination, support clearer articulation of issues in dispute, and strengthen litigation readiness.
Members broadly supported the pilot, noting its focus on addressing delays associated with internal handovers and improving oversight of complex matters. Discussion focused on governance safeguards, particularly maintaining independence in the objections process. The ATO confirmed that existing decision-making responsibilities and ‘fresh eyes’ requirements remain in place, supported by additional controls and independent oversight. Members also emphasised transparency, appropriate case selection, and ongoing evaluation, with the pilot to be reviewed after 12 months.
Artificial intelligence and its implications for taxpayers and advisers
The ATO provided an update on its use of artificial intelligence (AI), emphasising that its application is controlled, risk-based, and subject to human oversight. Current use is primarily focused on risk assessment, with emerging use cases supporting information processing and case triage.
A staged implementation approach is being adopted, with pilot activity used to inform capability, process design and risk management.
Members raised concerns about the broader impacts of AI, including increased disputes, overreliance on AI-generated advice and the risk of inaccurate information influencing behaviour across the tax system. The ATO acknowledged these risks and emphasised the importance of ongoing engagement and guidance to support appropriate use and maintain trust.
Overview of legislative process and Treasury update
Treasury provided an overview of the legislative process, highlighting that policy development is government-led and influenced by election commitments, economic conditions and stakeholder input. Treasury’s role is to provide advice and analysis, with decisions on policy design, prioritisation and timing ultimately made by Ministers and Cabinet.
The process is iterative and non-linear, with measures progressing through stages such as policy development, consultation, drafting and approval, and often evolving in response to emerging issues, competing priorities.
Treasury noted that delivery is shaped by significant resource constraints, particularly in drafting capacity, with a large pipeline of measures competing for limited resources. Parliamentary schedules and government priorities can further influence timing and compress later stages.
ATO consultation principles and processes
The ATO provided an overview of its consultation approach, noting that it operates within an established framework developed with NTLG input and supported by governance arrangements, guidance and agreed principles.
The ATO highlighted recent updates to the consultation snapshot report and outlined further administrative improvements under consideration, including a proposed single integrity declaration and improved practice across consultation groups.
The ATO outlined that public consultation is the default approach for developing public advice and guidance (PAG), with targeted consultation used selectively depending on timing, sensitivity, and stage of development. In some cases, consultation may be limited.
Where targeted consultation is used, participants are selected based on expertise and relevance. Visibility is supported through draft publications, compendiums and the Advice Under Development Program (AUDP), although some early-stage discussions may remain confidential.
Members highlighted challenges in tracking the status of guidance products, including limited visibility of development stages, perceived lack of transparency when products are delayed or paused, and difficulty identifying changes made through AUDP updates.
Budget measures
The ATO outlined its initial approach for moving from policy development and announcement to delivery and implementation for Budget measures. Members were invited to provide early input on implementation priorities, including:
- system changes
- tax return updates
- tools and calculators
- staff guidance
- frontline processes
- public advice.
The importance of coordinated consultation to avoid duplication and stakeholder fatigue was emphasised.
The ATO and Treasury noted this engagement represents the start of ongoing consultation, seeking early insight on key implementation issues such as valuation, record-keeping and data requirements. Members emphasised the importance of clear points of contact, early involvement in design, and focused guidance in complex areas, particularly valuation.
Members raised concerns about uncertainty for clients making restructuring decisions in the absence of final legislation and guidance, particularly where Commonwealth measures interact with state tax issues such as stamp duty. Treasury acknowledged these cross-jurisdictional complexities.
Further feedback highlighted the practical and financial burden of restructuring, risks of increased ruling requests, and limited dispute resolution pathways at the state level. Members emphasised the need for coordinated and consistent guidance across jurisdictions, and clear communication to support implementation. Members supported using existing stewardship groups for consultation, while noting the importance of visibility and coordination across forums.
Dynamic pay as you go instalments
The ATO provided an update on dynamic pay as you go (PAYG) instalments, which aim to improve the accuracy of instalment calculations by better aligning payments with current business performance. The initiative is planned for implementation from 1 July 2027 and will be supported by a draft Practical Compliance Guideline (PCG) outlining eligibility requirements, governance expectations and appropriate use.
To support implementation, the ATO has initiated a pilot with digital service providers and tax agents to test the calculation methodology across different entity and business types, informing system design ahead of broader rollout.
Members raised concerns that proposed eligibility criteria may be too restrictive and could discourage participation. Limited visibility of enforcement activity relating to inappropriate PAYG variations was also identified. Members emphasised the need for clear and proactive communication to manage expectations.
Further feedback highlighted behavioural, practical and technical considerations, including PAYG variation practices, support for new businesses and challenges in applying calculations under uncertain business conditions. The ATO confirmed that insights from the pilot will inform final design and that the PCG will be supported by a broader communication strategy. Further feedback was invited on both the PCG and the communication approach.
Other business
The ATO confirmed that the Digital Service Providers Strategic Working Group will transition to a formal stewardship group from 1 July 2026. This reflects the role digital service providers play in the tax ecosystem and aligns with the ATO Strategy’s focus on stronger ecosystem-wide stewardship and collaboration.
Attendees
|
Organisation |
Member |
|---|---|
|
ATO |
Kirsten Fish (Co-chair), Law Design and Practice |
|
ATO |
Jeremy Hirschhorn, Client Engagement Group |
|
Chartered Accountants Australia and New Zealand |
Lynda Brumm |
|
Chartered Accountants Australia and New Zealand |
Susan Franks |
|
Corporate Tax Association |
Simon Staples |
|
CPA Australia |
Alexis Kokkinos |
|
CPA Australia |
Jenny Wong (Co-chair) |
|
Institute of Public Accountants |
Tony Greco |
|
Law Council of Australia |
Mia Clarebrough |
|
Law Council of Australia |
Neil Brydges |
|
National Tax & Accountants' Association |
Robyn Jacobson |
|
The Tax Institute |
Julia Abdalla |
|
The Tax Institute |
Tim Sandow |
|
Treasury |
Diane Brown |
|
Treasury |
Laura Berger-Thomson |
Guest attendees
|
Organisation |
Attendee |
|---|---|
|
ATO |
Adrian Zuccarini, Private Wealth |
|
ATO |
Alister Boyes, International Support and Programs |
|
ATO |
Andrew Watson, Smarter Data Program |
|
ATO |
Claire Miller, Enterprise Solutions and Technology |
|
ATO |
Emily Webster, Office of the Chief Tax Counsel |
|
ATO |
Faith Harako, Litigation and Legal Services |
|
ATO |
Farisha Ali, Individuals and Intermediaries |
|
ATO |
Fiona Dillon, Office of the Chief Tax Counsel |
|
ATO |
Gianni Bei, Policy, Analysis & Legislation |
|
ATO |
Grant Brodie, Individuals and Intermediaries |
|
ATO |
Hoa Wood, Policy, Analysis & Legislation |
|
ATO |
Ian Colhoun, Policy, Analysis & Legislation |
|
ATO |
Ilana Millar, Policy, Analysis & Legislation |
|
ATO |
Janelle Oakes, Enterprise Strategy and Design |
|
ATO |
Kavita Panjrantan, Private Wealth |
|
ATO |
Larissa Evans, Law & Policy Design |
|
ATO |
Louise Clarke, Private Wealth |
|
ATO |
Rebecca Saint, ATO Executive |
|
ATO |
Rob Heferen, Commissioner of Taxation |
|
ATO |
Sheridan Harvey, Enterprise Strategy and Design |
|
ATO |
Will Day, Policy Analysis & Legislation |
|
Treasury |
Erin Wells |