The Government has extended the terms of, and increased funding for, several tax compliance programs including those targeting tax avoidance and the shadow economy. The Government has also funded measures seeking to enhance tax system integrity and modernise reporting systems.
Tax avoidance taskforce
The Government has boosted funding for the ATO Tax Avoidance Taskforce by ~$200 million p.a. over 4 years from 1 July 2022. The Government has also extended the Taskforce for a further year until 1 July 2025 until 1 July 2026.
The boosting and extension of the Tax Avoidance Taskforce will support the ATO to pursue new priority areas of observed business tax risks, complementing the ongoing focus on multinational enterprises and large public and private businesses. This measure is estimated to increase receipts by $2.8 billion and increase payments by $1.1 billion over the 4 years from 2022–23.
Extension of shadow economy program
The Government will extend the existing ATO Shadow Economy Program for a further 3 years from 1 July 2023. This will enable the ATO to continue targeting shadow economy activity and protect revenue.
This measure is estimated to increase receipts by $2.1 billion and increase payments by $685.2 million over the 4 years from 2022–23. This includes an increase in GST payments to the States and Territories of an estimated $442.3 million over the 4 years to 2025–26.
Compliance program to enhance tax system integrity
The Government will provide $30.4 million to the Tax Practitioners Board (TPB) to increase compliance investigations into high-risk tax practitioners and unregistered preparers over 4 years from 1 July 2023. The TPB will use new risk engines to better identify tax practitioners who engage in poor and unlawful tax advice, to improve tax compliance and raise industry standards.
This measure is estimated to increase receipts by $81.9 million, and increase payments by $30.8 million, over the 4 years from 2022–23.
Modernising systems
The Government will provide additional funding of $166.2 million over 4 years from 2022–23 to continue delivery of the Modernising Business Registers program that will consolidate over 30 business registers onto a modernised registry platform. These measures will also include funding for ATO and ASIC to operate and regulate the Director Identification Numbers regime and maintain ASIC’s registry systems.
