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The ATO is moving rapidly to deploy its full powers against a group of taxpayers who refuse to engage with it and collectively owe $11 billion in tax debt, the Commissioner has warned.
ATO sets its sights on 22k taxpayers with high-value debts
03 March 2025
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7 minute read
Commissioner of Taxation, Rob Heferen, has said that the ATO's primary focus with debt collection at the moment is a small group of taxpayers who "exhibit the most non-compliant behaviour in avoiding their obligations".
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In an address to the Senate Economics Legislation Committee this week, Heferen noted that only 22,000 taxpayers were responsible for $11 billion of the total tax debt value.
"In context, that’s about 1 per cent of the total debtors responsible for 20 per cent of what’s owed," he said.
"To be clear, I’m not talking about just the largest taxpayers – this 1 per cent are taxpayers of varying sizes and it is this group where our focus lies."
Heferen said the ATO would be taking a deliberate and targeted approach to collect tax, with action being taken against those who repeatedly refuse to engage with the Tax Office and continue to ignore its reminders.
"For these taxpayers, we are moving more urgently to deploy the full powers available to us, including issuing director penalty notices, taking garnishee action, and – if necessary – taking wind up action," he said.
"We are beginning to see the effects of this work, through reduction in the amount of debt owed to the government."
The ATO would be careful to differentiate taxpayers who may be experiencing vulnerability from those who are deliberately non-compliant.
"To support this, the ATO is implementing a vulnerability capability that will strengthen and coordinate the way the ATO supports those who need it most," Heferen said.
"This program of work will include the development of a framework, together with specific actions and activities to support people experiencing vulnerability, including financial abuse."
The Tax Office previously issued a warning to tax agents in October last year, warning that business clients that repeatedly ignore payment reminders would be pursued with aggressive enforcement measures.
“We are now focusing on businesses who refuse to engage with us and continue to ignore our SMS and letter reminders.”
The ATO warned its new approach may impact business clients who have not responded to past engagement attempts from the ATO.
Directors of multiple companies who have allowed tax and super to go unpaid and likewise failed to engage can expect the ATO "to look at their debts more holistically.”
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