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ATO action to reduce the gap

How we support our clients to meet their compliance obligations.

Published 3 November 2023

We understand the tax compliance of large corporate groups influences the confidence other taxpayers have in the fairness and integrity of the tax system.

Addressing the large corporate groups income tax gap also improves willing participation by other taxpayers. We seek to reduce the tax gap by managing the key compliance risks that drive it. We know the best way to achieve this is to focus on active prevention by supporting high levels of voluntary compliance. This underpins all our strategies and our key initiatives to sustainably reduce the tax gap.

We discuss the most significant compliance risks and how we treat them in Tax and Corporate Australia. One of our key strategies is to provide public advice and guidance to ensure large corporate groups understand our view and areas of concern. This allows them to make more informed compliance choices and improves community confidence by letting the public know we are identifying and addressing matters of concern.

Additional funding for the Tax Avoidance Taskforce boosted our capacity and capability to ensure large corporates are paying the right amount of tax in Australia. It allows us to:

  • expand our justified trust program to the largest 1,000 public and multinational groups
  • provide assurance over a significant portion of the tax expected to be collected
  • have greater insight into compliance risks in the population.

We advise the government, via the Department of the Treasury, about opportunities for statutory law reform to improve the tax system. We do this when:

  • the law is difficult to apply, for both taxpayers and us
  • clarification can help to decrease compliance costs
  • the law can be strengthened to allow us to deal with compliance risks more effectively.