ATO Audit Methods To Come Under Scrutiny

by Mary Swire, Tax-News.com, Hong Kong

20 August 2004

Australia’s Inspector-General of Taxation David Vos is expected to announce an investigation into the way the ATO conducts tax audits following growing concern that taxpayers and businesses are being treated unfairly, The Australian Financial Review reported.

The move is in response to a meeting with stakeholders in Sydney last month where the greatest concern expressed by taxpayers and their advisers was the ATO's conduct when dealing with taxpayers under audit, AFR revealed.

"On the basis of that strong feedback, we will undertake a series of reviews around the theme of tax office audit activity," Mr Vos was quoted as explaining.

The Inspector-General will also study long standing complaints by corporate taxpayers that the ATO has a so-called ‘inappropriate revenue bias’ when making decisions on contentious tax moves.

Under this policy, taxpayers believe that the tax office will always seek to protect revenue regardless of the merits of the case.

The accounting profession has also expressed concern that the ATO is placing unrealistic time-burdens on small business taxpayers to submit information to the taxman, whilst the tax office itself is often acknowledged to “take forever” to respond to taxpayer concerns.

The announcement comes a mere two days after Tax Commissioner Michael Carmody announced the ATO’s compliance programme for the year ahead.

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