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ATO - Treasury Protocol

The Protocol provides the agreed collaborative working arrangements between the Treasury and ATO.

Last updated 19 December 2023

Roles of the ATO and the Treasury

The Treasury and the Australian Taxation Office (ATO) share stewardship of Australia's tax system and some aspects of the superannuation, foreign investment, and registry systems (the Systems). The Treasury and the ATO are committed to working collaboratively to provide the best possible advice to Government on issues affecting the Systems, and the implementation of Government policy in a way that also meets user and community needs.

Policy, legislation and administration are integrally related and interdependent. The Treasury is responsible for the design of Government policies and legislation relating to the Systems. As a central policy agency, the Treasury is expected to anticipate and analyse policy issues with a whole of economy perspective, understand government and stakeholder circumstances, and consider changing events and directions.

The ATO is the Government's principal revenue collection agency, and part of the Treasury Portfolio. The ATO administers and implements the Systems that are the subject of this Protocol and can provide practical insights to the Treasury about the operation of the Systems, as well as current or proposed laws.

Purpose of the Protocol

This Protocol provides the agreed collaborative working arrangements between the Treasury and ATO across the matters dealt with by this Protocol.

The Protocol operates within the roles, expectations and relationships outlined in the Statement of Expectations and Statement of Intent between the Treasurer and the ATO. Australian Government best practice will underpin all work carried out within the Treasury and the ATO.

Five engagement principles apply to all interactions between the Treasury and the ATO. The Treasury and the ATO agree that they will seek to:

  1. Engage with each other as early as possible to provide better outcomes.
  2. Provide clear parameters, policy intent and timeframes to enhance accuracy and timeliness of responses.
  3. Ensure there are effective information flows that expedite responsiveness.
  4. Maintain high levels of mutual trust, which are essential in a highly sensitive operating environment.
  5. Rapidly resolve issues through early facilitation and escalation as appropriate.

Designing new policies

The Treasury will lead the development of new policy within Government and will consult with the ATO (through its Policy, Analysis and Legislation business line) as soon as practicable on proposed new initiatives. The ATO will share expertise with the Treasury on administrative design to help inform the development of new policy.

The Treasury and ATO will as soon as practicable share new policy initiatives and related issues that are raised directly by other portfolios. Where other portfolios raise ideas with the ATO, it will encourage those agencies to liaise with the Treasury directly. The Treasury and ATO will seek to have a shared understanding of the implementation and administration impacts of policy initiatives led by other portfolios that impact the ATO.

Regular briefings between the Treasury and the ATO about their respective operating environments will ensure responsiveness to any emerging risks and opportunities, as well as priorities and constraints.

Costings, forecasting and data sharing

A key element of advising on new policy is considering the revenue impact on government and the distributional and compliance cost impacts on taxpayers. Tax data and ATO intelligence are also key inputs to tax receipts forecasts.

The accountability for revenue costings and forecasting rests with the Treasury. However, the ATO will assist or collaborate with the Treasury in all aspects of the costing and forecasting process, whenever required or requested.

The Treasury Tax Analysis Division (TAD) will make requests for ATO assistance with costings including relevant timeframes to support analysis through the ATO's Revenue Analysis Branch (RAB).

The Treasury is to make clear the purpose of all data requests and whether they intend the data be publicly released. Where data relates to revenue costings or the development of policy, data must be assured by RAB prior to release to the Treasury. Data requests for other purposes may be made by relevant policy areas of the Treasury to the ATO. The ATO will provide data to the Treasury as permitted by law to support policy analysis and development and regulatory activities.

The ATO and the Treasury Chief Data Officer, supported by TAD, will continue to explore further lawful access and use of ATO data, including under the Data Availability and Transparency Act 2022.

The Treasury and ATO will maintain appropriate governance arrangements and monitor risks relating to the use of ATO data by the Treasury and periodically review data sharing arrangements and relevant Memorandum of Understandings (MOUs).

Designing and assuring new law

The ATO will leverage its experience to provide advice to the Treasury about whether new laws can be administered in line with policy intent and can successfully interact with existing legislation and the Systems. This will be achieved through a high level of integration between the ATO and the Treasury throughout the process, including across policy design, costings, law design and implementation.

After a new measure has been announced, the Treasury will work collaboratively with the ATO (through its Policy, Analysis and Legislation business line) in developing drafting instructions and draft law, together with explanatory materials for new law, wherever possible and within time constraints. When a new measure is ready for introduction into Parliament, joint assurance by the ATO and the Treasury will be undertaken to provide confidence to the Government that the draft law can be administered and interpreted in accordance with the underlying policy intent. Where joint assurance cannot be achieved, the unresolved issue will be escalated as appropriate.

The Treasury and the ATO will maintain procedures for quality assurance of new law.

Administering the law

Whilst acknowledging that the Courts are the final arbiters of the laws made by Parliament, the ATO interprets and enforces enacted law that it administers. In forming its view on the interpretation of law, the ATO may consult with the Treasury or undertake community consultation, where appropriate.

The ATO will engage the Treasury on policy and law design issues, including emerging areas of risk, that are identified in the administration of the law at the earliest possible juncture. Where the ATO identifies that enacted law is not operating consistently with the policy intent, and when this cannot be addressed administratively, the ATO will advise the Treasury. The Treasury will consider the issues raised by the ATO and advise the ATO of its views within a reasonable timeframe.

The ATO will also engage the Treasury on significant litigation matters as early as practical and will agree procedures with the Treasury to enable portfolio compliance with the legal services directions made by the Attorney-General.

The ATO is a key consultation partner for the Treasury in foreign investment screening and will assist with advice on tax risks and structuring of investment proposals.

Monitoring and evaluating policy

Understanding the collective impact of Government policy is critical to ensure the achievement of desired strategic outcomes and to support a clear, evidence-based approach to policy decision making in context of the wider Government policy agenda.

The ATO and the Treasury will work closely to establish and maintain agreed approaches to monitoring and evaluating programs, with a particular focus when there is shared responsibility across agencies. This includes specifying roles, responsibilities and governance arrangements that support the agreed approach.

Protocol oversight

The Treasury and ATO Forum (TATOF) has oversight of this Protocol and may recommend changes to support effective working relationships between the Treasury and the ATO. Periodically, the Forum will also review the underlying processes and procedures to ensure they are operating in line with the intent of the Protocol.


Dr Steven Kennedy signature


Chris Jordan signature

Dr Steven Kennedy PSM

Chris Jordan AO
Australian Taxation Office

December 2023