Our estimates have been derived from a broad range of information sources, including publicly-available information and ATO administrative data. We have applied either a top-down or bottom-up methodological approach to this information.
Top-down estimates are developed using externally-provided, aggregated data. For example, our GST estimates rely on Australian Bureau of Statistics (ABS) National Accounts household consumption expenditure data to estimate the amount of tax that should have been paid.
Bottom-up estimates are developed using unit record data and then extrapolating the results across the entire taxpayer population. In some instances, particularly when estimates are based on operational (audit) data, we need to control for selection bias before this information can be reliably applied to the broader non-audited population.
We briefly explain the methodology used to construct each estimate in the sections that follow.