The GST Compliance Program was established in 2010 and following subsequent renewals, now contributes a significant proportion of all GST administration results, returning approximately $14 billion in GST revenue to the states and territories through to June 2022.
In 2019, the ATO was provided additional funding through to June 2023, to provide the resourcing needed to ensure program objectives are met. The following summarises the 2021–22 financial outcomes for the current compliance program objectives:
- Taxpayers are correctly registered – Registration checks resulted in $40.9 million in additional GST liabilities for the year, exceeding the planned commitment of $13.8 million. Coverage to ensure clients were correctly registered was achieved. This strategy has detected and deregistered fraudulent clients from the GST system.
- Correct reporting is focused on tackling refund exploitation and dealing with systematic or deliberate under-reporting of GST – Compliance activities raised $2,009.6 million in 2021–22, exceeding the target of $317.2 million. This strategy has maintained a strong focus on pre-issue reviews for high-risk GST refunds and detecting fraudulent behaviours. New analytical risk models, the development of which were also funded via the program, were implemented during 2021–22 and have been highly successful in detecting a wider range of suspect refunds and fraud, further protecting GST revenue.
- Large businesses pay the right amount of GST – Assurance programs are continuing to build and maintain community confidence that taxpayers are paying the right amount of GST. Revenue commitments were met, with $146.4 million raised this year against a planned commitment of $137.6 million.
- More direct contact between the ATO and non-lodgers – Lodgment compliance activities raised $743.0 million against the planned commitment of $381.8 million.
- More direct contact between the ATO and taxpayers with a GST debt – GST debt recovery activities returned $782.1 million against an annual commitment of $250.5 million. Collectable debt, in particular small business collectable debt, is a continuing priority for the ATO.
These objectives are managed through 12 strategies, outlined in the GST Compliance Program 2019–23 bid papers.
In 2021–22, GST compliance and lodgment enforcement activities raised total liabilities of $2,940.0 million, exceeding the commitment of $850.4 million by $2,089.6 million. This was considerably above normal years’ results and was driven by Operation Protego, linked with our correct reporting strategy, and supported by the development of new generation risk models.
The strategies and compliance liabilities raised within the objectives are detailed in the table below.
Strategy number |
Key objective |
Strategy description |
GST $m |
|---|---|---|---|
1, 11 |
4 |
Lodgment compliance activities to ensure taxpayers that are required to lodge are lodging, promoting fairness and confidence in the system; to address declining performance of quarterly BAS lodgment, predominately for the small and micro segments. |
743.0 |
3 |
1 |
Ensure taxpayers are correctly registered in key risk areas such as GST registrations, deferred GST, and associated account integrity. |
40.9 |
4 |
2 |
E-audit capabilities to more efficiently and effectively analyse taxpayer-provided data. |
59.2 |
5 |
2 |
Correct reporting tackling refund exploitation to detect, address and deter GST incorrect reporting and GST refund fraud. |
1,889.1 |
6(a) |
2 |
Detect and deal with the most egregious taxpayers who seek to hide or avoid GST to obtain an unfair advantage. |
61.3 |
6(b) |
5 |
Investigations and prosecutions action that sends a strong message to the community of the high risk of being detected and the consequences of non-compliance behaviour. |
- |
7 |
5 |
Dispute resolution leading to the prevention or early resolution of disputes under objection. |
- |
8 |
All |
Risk and strategy resourcing to assess risk to the GST system and determine the most appropriate strategies for the resources available. |
- |
9 |
All |
Program management, effectiveness, and GST gap research to better understand influences on the GST gap and international benchmarking across jurisdictions. |
- |
10 |
2 |
Improve risk models to take advantage of technology and better use of data. |
- |
12 |
3 |
Large business compliance to provide greater assurance that large public, multinationals and private businesses are meeting their GST obligations (justified trust). |
146.4 |
Total |
2,940.0 |
||
2 |
5 |
Prevent and reduce GST debt arising from Compliance Program outcomes achieved. |
782.1 |