Registration
GST registration is the front door to the GST system. In assisting taxpayers to correctly register for GST, we enable them to both enter and exit the GST system as required.
GST registrants increased slightly this year with 3.4 million businesses registered at 30 June 2024.
For new GST registrants, we delivered tailored education to assist them to get it right from the start and develop positive behavioural practices.
We continue to maintain the integrity of the GST client register with our ATO-initiated activities to identify and remove (cancel) GST clients who:
- incorrectly registered
- incorrectly left the system (no longer require their GST registration but failed to cancel it).
Table 4.2 shows little change in the proportion of entities that declare business income (more than $75,000) in their income tax returns to compulsory registrants. This indicator assesses whether we have the right number of registrants in the system and is reported one year in arrears due to reliance on corresponding income tax data.
|
Type |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Total GST registrants |
2,910,000 |
3,080,000 |
3,250,000 |
3,320,000 |
3,420,000 |
|
- Non-reporting registrants |
n/a |
n/a |
86,000 |
87,000 |
91,000 |
|
New registrations |
371,000 |
409,000 |
496,000 |
445,000 |
436,000 |
|
Cancelled registrations |
263,000 |
253,000 |
294,000 |
363,000 |
331,000 |
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Compulsory GST registrations compared to potential GST registrations |
96.6 |
97.2 |
96.9 |
97.2 |
97.3 |
|
Category |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Small business |
n/a |
2.40 |
2.51 |
2.55 |
2.61 |
|
Privately owned and wealthy groups |
n/a |
0.40 |
0.47 |
0.48 |
0.51 |
|
Public and multinational businesses |
n/a |
0.08 |
0.08 |
0.08 |
0.09 |
|
Not-for-profit |
n/a |
0.07 |
0.07 |
0.08 |
0.08 |
|
Other |
n/a |
0.12 |
0.13 |
0.12 |
0.13 |
|
Total registered client base |
2.91 |
3.08 |
3.25 |
3.32 |
3.42 |
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Australian resident ABRS registrations finalised in 20 business days |
99 |
99 |
99 |
98 |
99 |
Cross-border services and goods
We continue to administer the cross-border GST. Of the $1.6 billion paid by the 2,600 non-resident GST registrants, $42 million was directly attributable to our compliance activities.
Our education and compliance activities resulted in 386 new non-resident GST registrants in 2023–24, an increase of 37% from the previous year.
A one-month campaign in late 2023 to increase awareness of Australian GST obligations for non-resident businesses in United States of America and United Kingdom resulted in:
- close to 3 million impressions (the number of times seen)
- a significant increase in traffic to the relevant GST content on our website with over 10,000 page views during the campaign, compared with 1,012 in the previous month
- 56% increase in new non-resident GST registrants in the 6 months after the campaign compared to the same period the year before.
Table 4.5 observes a 22% increase in GST revenue from businesses making supplies of low value imported goods. This is largely attributed to one entity remitting $115 million.
Internationally, we chair an Organisation for Economic Co-operation and Development (OECD) focus group designed to enhance international consistency of GST policy design and support tax administrations in improving GST compliance in digital trade.
Australia’s active involvement in this international GST dialogue ensures the effective exchange of insights, experiences, and intelligence on risks, trends, and emerging issues. This strengthens our capacity to respond to the challenges of administering GST in a global digital economy.
Improved use of card-payment data sourced from the Australian banking sector has identified non-resident businesses with unmet GST obligations related to the supplies of goods and services they make to Australian consumers.
This has provided new opportunities to differentiate our risk management approach, implement targeted education and compliance strategies and ensure a level playing field between non-resident and domestic businesses.
|
Category |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Imported services GST |
550 |
700 |
780 |
805 |
875 |
|
Imported low value goods GST |
420 |
500 |
565 |
610 |
745 |
|
Total |
975 |
1,200 |
1,340 |
1,410 |
1,620 |
Lodgment and payment
Our focus remains to foster on-time lodgment and payment behaviours and prevent future debt by making it easier to pay. We pursue outstanding payments and demonstrate the consequences of avoiding payment obligations by:
- advising those who can pay, they must pay on time
- firmer action for those choosing not to engage or pay
- supporting those struggling but have the capacity to pay to get back on track
- supporting those without capacity to pay to exit the system.
Lodgment
Approximately 7.2 million on-time BAS lodgments were received in 2023–24. This was around 303,000 more than 2022–23. The BAS on-time lodgment performance increased slightly this year by 0.4 percentage points.
As shown in Tables 4.6 and 4.7 below, there is a noticeable change in the 2023–24 monthly and quarterly results when compared to previous years. From this year, we are using the GST period date, which more accurately reflects if the taxpayer’s GST lodgment period is monthly or quarterly. Previously, we used the activity statement period dates.
As part of our ongoing commitment to ensure registration of entities are correct, we identified taxpayers demonstrating no signs of active operations for GST purposes and removed them from our BAS lodgment population. We notified them of this decision and provided guidance on how to re-establish their GST registration if required. Our actions have reduced unnecessary correspondence and interactions.
Whilst our initial focus this year has been on small businesses, we will be expanding these integrity improvements to other entities.
External communications will also increase to educate taxpayers on the need to cancel GST and ABN registrations where they are no longer required. This will ensure we can better target active entities who are failing to meet their lodgment obligations.
|
Type of lodgment |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Lodged (monthly) |
90.8 |
89.9 |
88.9 |
87.3 |
81.9 |
|
Lodged (quarterly) |
82.3 |
81.9 |
80.9 |
82.0 |
83.7 |
|
Total BAS lodged |
84.6 |
84.1 |
83.1 |
83.4 |
83.4 |
|
Type of lodgment |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Lodged on time (monthly) |
81.8 |
78.5 |
76.1 |
76.3 |
69.0 |
|
Lodged on time (quarterly) |
71.0 |
67.3 |
67.9 |
69.3 |
72.2 |
|
Total lodged on time |
74.0 |
70.3 |
70.1 |
71.2 |
71.6 |
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Proportion finalised within 12 business days |
99.7 |
99.2 |
98.7 |
99.7 |
99.7 |
|
BAS lodgment frequency |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Monthly remitters |
87.4 |
92.2 |
93.3 |
94.5 |
94.7 |
|
Quarterly remitters |
88.2 |
88.4 |
92.1 |
89.8 |
94.3 |
|
Annual remitters |
91.3 |
95.0 |
95.5 |
95.4 |
96.8 |
|
Overall |
88.2 |
88.9 |
92.3 |
90.4 |
94.5 |
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
BAS filed by intermediaries or tax agents |
55.4 |
56.6 |
56.6 |
58.9 |
59.6 |
Payment
In the 12 months to 30 June 2024:
- total ATO collectable debt increased 5.2%
- GST collectable debt increased 2.6%
- the ratio of GST collectable debt to GST collections (cash) reduced from 15.8% to 15.6%.
To support a healthy economic system and protect the community we are responding with a firmer approach earlier to recover outstanding GST debts.
The slowing of the growth in GST collectable debt indicates our firmer actions may be starting to slow and stabilise the increase of collectable debt.
Current year results reflect a revised calculation including real time payments. Previously, we used the date we processed a payment.
|
Type of GST debt |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Total debt outstanding |
10,185 |
10,660 |
12,302 |
15,930 |
17,162 |
|
- Collectable debt |
7,869 |
8,766 |
10,366 |
12,883 |
13,217 |
|
- Insolvent debt |
n/a |
1,628 |
1,819 |
2,664 |
3,474 |
|
- Disputed debt |
n/a |
265 |
117 |
383 |
471 |
Figure 4.1 Ageing of GST collectable debt by value
|
Type of collection |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Tax liability method (TLM) accrual |
11.8 |
12.1 |
13.6 |
15.0 |
14.9 |
|
Cash |
13.1 |
12.0 |
14.1 |
15.8 |
15.6 |
By identifying and removing non-pursuable debt (irrecoverable at law or uneconomical to pursue) from collection activities, we can focus our attention on the right cases. The return to normal collection activities following COVID-19 has resulted in increases in the identification of debts that are irrecoverable at law or uneconomical to pursue this year. This is shown in Table 4.13 which compares non-pursuable debt to both total GST debt and GST revenue.
Table 4.14 shows whilst the number of GST payments paid on time has decreased slightly, the value of those payments paid on time is at its highest level in 5 years at 88.5%.
Additionally, due in part to our tailored engagement approaches including leveraging through our tax practitioner community and media, we receive 95.2% of payments within 90 days of the due date.
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
GST debt non-pursuable to total GST debt |
4.3 |
5.1 |
5.4 |
4.6 |
11.5 |
|
Ratio of GST debt non-pursuable to GST revenue |
0.7 |
0.7 |
0.9 |
0.9 |
2.3 |
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
GST payments made on time |
76.3 |
73.0 |
70.4 |
71.3 |
71.1 |
|
Value of GST paid on time |
86.5 |
85.9 |
85.8 |
87.7 |
88.5 |
|
Category |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
<1 month |
1,006 |
835 |
905 |
1,069 |
1,019 |
|
1–2 months |
1,705 |
1,270 |
1,352 |
1,717 |
1,777 |
|
2–3 months |
470 |
248 |
341 |
275 |
292 |
|
3–12 months |
2,701 |
2,745 |
3,712 |
3,475 |
3,684 |
|
>1 year |
1,987 |
3,668 |
4,056 |
6,346 |
6,444 |
|
Total GST debt value |
7,869 |
8,766 |
10,366 |
12,883 |
13,217 |
Compliance engagement
In 2023–24, the ATO raised $3.0 billion in liabilities through compliance activities. The results have returned to normal levels following the impacts of Operation Protego in 2021–22 and 2022–23.
We continue to strengthen and enhance the management and oversight of the GST system, with an emphasis on:
- identifying and remediating system vulnerabilities
- reducing non-compliance
- mitigating emerging threats to the system.
Through 2023–24 our Contemporising GST Risk Model project designed improved analytical risk models to target risks and behaviours that impact the integrity of the GST system. These models increased our capability to effectively manage GST compliance risks.
Emphasis has been placed on assessing and treating fraud, including actions to better understand and enhance our management of GST fraud.
The ATO Counter Fraud Strategy announced in Budget 2024 has bolstered our ability to fight back against the growth in identity crime-enabled fraud and scaled fraud attacks across our digital services. These attacks are agile, prolonged, and persistent. The risk is amplified by global threats, organised crime, and increasing numbers of data breaches in the community.
Ongoing investment to place downward pressure on GST risk will allow us to continue our emphasis on preventative and detected measures. This allows us to respond to increasingly agile and sophisticated actors, safeguarding the system against misuse, and ensure taxpayers’ compliance.
Emerging threats
Shadow economy behaviour continues to evolve through the proliferation of digital technology such as electronic sales suppression tools (ESSTs).
Due to an increasing digital economy and specifically, more payment service providers, the risk posed by ESSTs is estimated to have tripled in the last 3 years. Manufacturers and suppliers of ESSTs are well-funded, well-resourced, and technologically advanced.
ESSTs understate sales for GST and income tax purposes. This rapidly evolving technology with integrated functionality across business systems allows users to access point of sales systems remotely to delete, re-sequence or manipulate records. We are working domestically and internationally to disrupt the manufacture, supply and use of these ESSTs.
We are seeing an increasing prevalence of sophisticated structuring arrangements between inter-related parties in the privately owned and wealthy groups market. The arrangements are primarily undertaken to obscure transactions and disguise artificial or fraudulent arrangements resulting in high value GST refunds. These arrangements often involve high value purported transactions or purchases, such as purchases of real property.
We believe there are groups or networks of industry participants within established related party groups who are involved in commercial arrangements which seek to exploit the GST rules in relation to interparty transactions including through:
- false invoicing between related entities (for example issuing invoices where no goods or services are provided)
- deliberately misaligning GST accounting methodologies across the group (for example one entity operating on a non-cash (accrual) basis whilst another utilises a cash basis in order to contrive a GST refund due to the mismatched timing of the methodologies)
- duplicating GST credit claims in related entities for a single high value transaction
- claiming GST credits for purported purchases, development, and construction (by related entities) which never occurred.
We will effectively deal with those who engage in GST Fraud, false invoicing or other illegal financial arrangements, including through working with partner agencies where appropriate.
Compliance liabilities
In Tables 4.17 and 4.18, the cash collection rate from client engagement activities is based on collections within the year that relate to the liabilities raised in that year only. On the other hand, total cash collections (excluding penalties and interest) estimated within the year can also include collections that relate to compliance liabilities raised in previous years.
|
Type of measure |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
GST liabilities raised |
2,645 |
2,339 |
5,407 |
4,829 |
2,958 |
|
Client experience |
GST compliance liabilities $m |
Within year compliance cash collection $m |
Cash collection rate % |
Total compliance cash collections $m |
|---|---|---|---|---|
|
Small business |
1,503.6 |
894.5 |
59.5 |
1,253.4 |
|
Privately owned and wealthy groups |
1,078.1 |
731.0 |
67.8 |
893.4 |
|
Public and multinational businesses |
363.8 |
302.6 |
83.2 |
317.1 |
|
Not-for-profit |
-9.3 |
-23.0 |
247.7 |
-21.4 |
|
Other |
21.7 |
18.5 |
85.1 |
22.9 |
|
Total |
2,957.9 |
1,923.6 |
65.0 |
2,465.4 |
|
Category |
GST compliance liabilities $m |
Within year compliance cash collections $m |
Cash collection rate % |
Total compliance cash collections $m |
|---|---|---|---|---|
|
Construction |
959.3 |
638.5 |
66.6 |
824.6 |
|
Professional, scientific and technical services |
465.1 |
337.9 |
72.7 |
395.7 |
|
Administrative and support services |
224.1 |
159.6 |
71.2 |
176.4 |
|
Rental, hiring and real estate services |
220.6 |
147.8 |
67.0 |
188.3 |
|
Transport, postal and warehousing |
212.1 |
149.8 |
70.6 |
193.6 |
|
All other |
876.7 |
489.9 |
55.9 |
686.9 |
|
Total |
2,957.9 |
1,923.6 |
65.0 |
2,465.4 |
|
Type of activity |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Business as usual |
7.0:1 |
7.9:1 |
10.4:1 |
10.6:1 |
8.3:1 |
|
GST Compliance Program |
15.5:1 |
11.3:1 |
30.1:1 |
23.5:1 |
12.9:1 |
|
Client experience |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Small business |
n/a |
87 |
95 |
83 |
73 |
|
Privately owned and wealthy groups |
n/a |
66 |
62 |
56 |
53 |
|
Public and multinational businesses* |
n/a |
75 |
53 |
56 |
55 |
|
Not-for-profit* |
n/a |
81 |
35 |
47 |
54 |
|
Other |
n/a |
85 |
92 |
92 |
88 |
|
Overall |
80 |
86 |
94 |
84 |
73 |
*The strike rate for categories with low case number can fluctuate dramatically from one reporting period to the next.
GST refunds random audit program
We have completed our first comprehensive evaluation of the GST risk models. The data will provide valuable insights into the real-world performance of our machine-learning models.
Our evaluation focussed on assessing the GST high risk refund models performance, specifically examining the accuracy and effectiveness of the Incorrect reporting model and the Identity crime model.
In the ever-evolving landscape of GST refund integrity, distinguishing between genuine identity (ID) crime and deliberate incorrect reporting is crucial.
By analysing audit results, we evaluate the accuracy and reliability of these models to ensure they reflect the actual risk scenarios we encounter.
By refining our models and incorporating additional risk factors, we enhance our ability to protect taxpayers and maintain the integrity of the GST system.
|
Client experience |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Small business |
n/a |
374 |
2,688 |
2,054 |
517 |
|
Individuals |
n/a |
18 |
388 |
459 |
34 |
|
Privately owned and wealthy groups |
n/a |
66 |
86 |
130 |
251 |
|
Public and multinational businesses |
n/a |
19 |
23 |
10 |
41 |
|
Not-for-profit |
n/a |
4 |
10 |
12 |
2 |
|
Other |
n/a |
2 |
2 |
4 |
1 |
|
Total |
306 |
484 |
3,198 |
2,668 |
846 |
|
Client experience |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|
|
Small business |
n/a |
95 |
98 |
88 |
78 |
|
Individuals |
n/a |
98 |
97 |
95 |
94 |
|
Privately owned and wealthy groups |
n/a |
74 |
70 |
65 |
51 |
|
Public and multinational businesses* |
n/a |
85 |
50 |
66 |
57 |
|
Not-for-profit* |
n/a |
92 |
36 |
56 |
54 |
|
Other* |
n/a |
92 |
40 |
57 |
60 |
|
Total |
85 |
94 |
97 |
89 |
78 |
* The strike rate for client experiences with low case numbers can fluctuate dramatically from one reporting period to the next.
Prosecutions and investigations
Criminal investigations and prosecutions as part of a ‘consequence strategy’ remain our firmest actions to protect the GST system against fraud and related crimes.
We are working with our state and territory partners through the ATO-led Serious Financial Crime Taskforce. Operation Protego is an example of effectively partnering with law enforcement agencies and the Commonwealth Department of Public Prosecutions (CDPP).
In 2023–24:
- 18 of the 26 criminal investigations we completed proceeded to a prosecution referral
- successful prosecutions in 11 cases referred to CDPP resulted in
- 9 custodial sentences
- over $24,000 in fines
- over $656,000 in reparation orders
- under Operation Protego, an additional 43 people were convicted of fraud with sentences including jail terms. Four Operation Protego investigations remain in progress.
We build community trust and confidence in ATO by leveraging successful prosecutions of evident risks through targeted media and communication activities.
Notable CDPP-led prosecutions completed under the Criminal Code Act 1995
A taxpayer was charged for dishonestly causing risk or loss to the Commonwealth with a loss to the ATO of over $900,000. It was found that approximately 50 BAS lodged by the person for 2 businesses contained false information. Due to a guilty plea, they received a reduced 4 years and 9 months sentence with a 30-month non-parole period.
Under Operation Protego, a taxpayer was charged for obtaining financial advantage by deception and for attempting to obtain a financial benefit by deception. He was sentenced to 7 years and 6 months imprisonment with a non-parole period of 5 years. Orders were also made to restrain real property.
Notable ATO-led prosecutions completed under the Taxation Administration Act 1953 (TAA)
Magistrates continue to impose large penalties for individuals who fail to meet their GST obligations. Convictions and fines include:
- $40,000 for failing to lodge 28 GST and 8 income tax returns
- $28,000 for failing to lodge 13 GST and 5 personal income tax returns, and 6 super fund income tax returns as a trustee
- $15,000 for failing to lodge 1 GST and 3 income tax returns.