ATO lambasted for super guarantee failure
The Australian Taxation Office (ATO) has proved only ‘partly effective’ in clamping down on employer non-payment of the superannuation guarantee (SG) according to the Australian National Audit Office (ANAO).
In a report tabled in Parliament last week and referenced by the new chair of the Senate Economics Legislation Committee, Senator Jess Walsh, the ATO has admitted that it has had only a small influence on the net superannuation guarantee gap.
The ANAO noted that at least some of the problems for the ATO were related to compliance work suspended as a result of the COVID-19 pandemic.
Commenting on the ANAO report in the Senate, Senator Walsh pointed to what represents a $5 billion gap in “stolen super missing from the retirement savings of Australian workers”.
She said this was because the former Government “had sat back and allowed the ATO to taka light touch approach to dodgy employers”.
Walsh said that the approach had resulted in less than 15% of unpaid SG being recovered by the ATO and that the absence of a proactive approach by the Tax Office “means it has been workers themselves who have been required to do all the heavy lifting”.
The ANAO report said the ATO’s compliance activities were partly effective in achieving greater employer compliance with SG obligations but that the extent of improvement in employer compliance was difficult to establish due to a lack of performance information.
“Although there has been an increase in the absolute amount of debt raised and funds collected, the ATO has acknowledged that it has a small influence on the net SG gap,” the report said.
“Planned targeted reforms to improve the integrity and administration of the SG system were partly implemented. Although the ATO did not fully employ its SG debt-recovery powers during 2020, in line with its suspension of other ATO-initiated compliance work during the COVID-19 pandemic, SG debt increased at a higher rate than total ATO debt in 2020–21.”
The ANAO report also pointed to the so-called SG Taskforce having fallen well short of its objectives, stating that it “partly achieved the planned outcomes”.
“It achieved a higher strike rate from a smaller case pool, but it did not achieve several of its objectives associated with the usage of Single Touch Payroll and other data,” it said. “The level of proactive compliance activities undertaken by the ATO declined after the SG Taskforce was introduced.”
“The SG Amnesty supported the ATO’s transition to a preventative compliance approach by encouraging employers to self-correct non-compliance and is associated with higher voluntary employer lodgments. The ATO did not report on SG Taskforce outcomes. Its reporting of SG Amnesty outcomes could have been improved by adjusting the results achieved to account for the business-as-usual level of voluntary lodgments.”
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