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The professional body is calling for greater funding for the ATO to improve its efficiency and services for tax agents.
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Government must address 'declining ATO service standards', says CA ANZ
10 February 2025
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7 minute read
Chartered Accountants ANZ (CA ANZ) has urged the government to increase funding for both the ATO and the Inspector-General of Taxation and Taxation Ombudsman (IGTO) to ensure the regulation and administration of the tax system works efficiently.
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In a pre-budget submission, the professional body said the ATO plays a critical role administrating the tax law on behalf of the government.
"Given the size of the ATO, the complexity of the law and its administration, it is vital tax agents, their clients and the public can deal efficiently with the ATO," it said.
"Resources should be allocated to the ATO for the purpose of increasing efficiency, in recognition of the publicly acknowledged declines in ATO service standards."
CA ANZ said that in some cases the current service standards were leading to business indecision or compliance mistakes.
The submission said increasing the resources of the ATO was also critical given the surge in ATO debt collection activity targeting small business operators.
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Extra funding could enable the ATO to implement a booking service to facilitate efficient issues resolution, especially in relation to tax debt collection and small business disputes, it said.
The professional body also stressed that it was a critical time for increasing funding for the ATO given the significant Payday Super changes on the horizon.
"Payday Super is a fundamental change to long established practice and needs to be carefully and thoughtfully implemented, including funding important reforms to ATO reporting to employers, to minimise unintended consequences," it said.
CA ANZ said Superannuation Guarantee (SG) penalties also need urgent reform ahead of payday super, especially after the wage theft laws were changed in mid-2024.
"The SG system would work better if the ATO could issue binding advice," it said.
CA ANZ said the Payday Super concept should also be expanded to include all employer superannuation entitlements, such as salary sacrifice contributions.
Post-implementation review of Tax Agent changes needed
The CA ANZ submission also called for a post implementation review of the various tax agent services amendments imposed recently, comparing the efficacy of the changes to the James Review recommendations.
"While the government has made improvements to the tax agent services regime and the powers of the Tax Practitioners Board (TPB), the cumulative effects of various amendments that go beyond what is necessary to achieve the purpose of the rules has resulted in overlap, duplication and complexity in the regulatory regime for tax agents," the professional body said.
"The additional compliance costs, uncertainty and business risks are disproportionately borne by sole and small tax practices without adding value to the economy."
CA ANZ said the government should also increase funding for the TPB, to enable it to support and regulate tax practitioners in relation to the new obligations under the Code of Professional Conduct.
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