IGT details new review

According to a statement from Ali Noroozi, the IGT, current international developments show a trend toward a formalised statement of taxpayer protections or rights, which may be in legislative or administrative form, however, in Australia the primary publication which sets out taxpayers’ rights and obligations is the Australian Taxation Office’s (ATO) Taxpayers’ Charter.

Whilst the charter refers to “rights” and “obligations”, they are more accurately described as a set of mutual expectations leading to stakeholder concerns that the charter is insufficient in protecting the rights of taxpayers and that ATO officers do not always adhere to its principles.

Stakeholders have raised specific concerns with the adequacy of current compensation schemes in providing redress for loss or damages resulting from inappropriate ATO actions. These include a lack of transparency and independence in the way the schemes are administered and there are particular concerns with the ATO’s adherence to the Model Litigant Rules, according to the IGT.

“The adequacy of the ATO’s administration of compensation schemes to provide redress to taxpayers and its adherence to the Commonwealth’s Model Litigant Rules will also be examined with the aim of identifying improvements,” said Mr Noroozi.

In addition the IGT highlighted the protection of taxpayers’ rights in cross-border information exchanges between revenue authorities, particularly in light of recent measures to address base erosion and profit shifting (BEPS). It is an emerging issue for revenue agencies and taxpayers alike.

“We are looking for a balanced approach to the protection of taxpayers’ rights which should not hinder the responsible collection of revenue but rather foster greater trust and voluntary compliance,” Mr Noroozi said.