IGTO - Interest remission and taxpayer compliance

Question

Senator LIDDLE: Under your recommendations, does the ATO have to go back and review the decisions it made in 2023 and address any historical mistakes? Ms Owen: No. Some of the recommendations that I've made are for the ATO to reconsider how it uses its discretion in releasing taxpayers, be they individuals or businesses, from their interest. Just to explain really quickly, what I'm seeing in particularly the complaints that I receive is a number of taxpayers who have got themselves for a number of reasons into tax debt. The application of general interest charge makes that tax debt grow and grow and grow to the point that they actually can't pay it back. So my recommendation is that, where people are actually trying to do the right thing, trying to engage with the tax system and trying to become compliant, the tax office should find ways to agree to remit some of that interest upfront so that they can come to an agreement to pay that tax debt back. And that certainly is the majority of the cases that I've seen. The tax office has agreed with my recommendation that that should be something that they should explore. I'm waiting to see how they will fulfil that recommendation, but I'm not expecting it to be retrospective. Senator LIDDLE: So, just for clarification, you don't have any data about how many people have been affected by that? Ms Owen: Not with me. I can take it on notice, but I think that the data is really the ATO's data.

Answer

See attached response.

Documents

• Question with answer (PDF) (opens in a new tab)
• SQ26-000490 IGTO - Interest remission and taxpayer compliance.pdf (opens in a new tab)