Pre-filling and small business benchmarks
This tax time I encourage tax agents to use our pre-filling service, which is available through the agent portal. This service is designed to make the process of preparing tax returns easier, quicker and more accurate for tax agents. It provides upfront access to information held on our systems so you can address any discrepancies in the data before agents lodge a client’s tax return.
On many occasions the pre-filling information acts as a prompt to remind clients of matters that may have slipped their minds and hence this service can be used as a tool when working with clients this tax time.
The ATO’s role in law development
I sometimes assume people know things, for example that the ATO does not make the law, we are the principal advisers on tax policy. However, we do have a role to play in policy and law development.
In fact it is Treasury, through its Revenue Group, that has primary responsibility for advising the Government on tax policy and the design of tax laws. The ATO is responsible for the interpretation and administration of tax laws.
Treasury and the ATO work cooperatively to provide high quality advice to the Government on tax system issues, consistent with an integrated design approach in the development of drafting instructions to the office of Parliamentary Counsel, which actually drafts the laws.
To the extent that we can, we contribute our views and experience to all stages of the tax policy and legislation design process. To meet this accountability and role in the law design function, we provide advice to Treasury on:
- the administrative and interpretive aspects of tax design
- material that may form the basis of official costing of tax proposals, including administrative costs and the compliance implications of policy advice
- issues that emerge through our experience in administration, including compliance costs and other issues that may arise for taxpayers in complying with proposed tax laws.
A draft practice statement – PSLA 3473 – on the ATO’s role in tripartite law design expands on the principles set out in the Protocol we have with Treasury (www.ato.gov.au). At paragraph 11 of that draft practice statement, we say: Within the framework set out in the Protocol, the ATO’s role in tripartite tax law design is to provide high quality input into the development of tax policy and legislation, by contributing its views and experience, particularly in relation to … administrative impacts.
The Protocol and draft practice statement are more focused on the ATO’s role during the course of policy design and law development. Integrated law design is intended to ensure the administrator’s perspective is brought to bear at this point, to ensure that new policy and law can be sensibly administered.
A further important aspect of providing the administrator’s perspective is ATO-suggested legislative amendment minutes to Treasury, through which unintended outcomes or improvements to the operation of the law can be identified.
The way forward is clear where our interpretation of the law cannot be reconciled with what is understood to be the policy intent underlying that law. These circumstances are rare because we adopt a purposive approach to the interpretation of relevant statuses and where the legislation seems to miss the mark in terms of policy intent, we raise this concern with Treasury.
The more common and difficult scenario is where an ATO view of the law considered to be consistent with the underlying policy intent is subject to dispute through objection and review processes. A similar predicament arises where the ATO’s view of the law is ultimately found by the courts or tribunal not to be correct. There are arrangements in place to provide advice to Treasury on the risk that the law may be or has been interpreted by the courts contrary to the understood policy intent. In this way the Government has the opportunity to consider whether a legislative fix is warranted.
On the radar this tax time
Our compliance program 2012-13 makes transparent to the community the current tax and superannuation compliance risks about which we have concerns. It also outlines what we are doing to address these risks and seeks feedback from the community on what’s happening on the ground, and whether or not we are on track.
We welcome your feedback.
