Media release: 24 September 1999
TAX FILE NUMBERS INQUIRY LOOKS AT $500m LOSS
The House Economics Committee has decided to follow up the Auditor-General's
report on tax file number problems. The Auditor-General states that $500m
worth of tax is not being collected because of tax file number weaknesses.
The Committee Chairman, David Hawker MP, said 'The Auditor-General's
report found some glaring inefficiencies in the management of the TFN
system despite the improvement in tax collection through the use of TFNs.
The audit also suggested that the ATO could have been more active in telling
government about problems.'
'The Economics Committee's investigation will pick up these critical
administrative, policy and taxpayer issues from the audit, as well as
other significant aspects of TFN management.'
Mr Hawker said 'The Committee's work will build on the ANAO audit, not
duplicate it. Other areas of investigation include:
- Why there are 3.2 million more tax file numbers in Australia than
people;
- Why the Tax Office cannot reconcile investment accounts of banks and
other funds;
- Why apparently none of the ATO's internal databases are linked;
- The quality of the ATO's data bases especially since, according to
the report, the quality of its main databases were probably somewhere
between unsatisfactory and average;
- Potential fraud with proof of identity for TFNs–already there are
nearly 200,000 duplicate TFNs;
- While recognising the privacy sensitivities, voluntary compliance
in the use of TFNs versus mandatory use;
- Any important areas for the extension of the use of the TFN (eg. to
financial transactions such as real estate and the transactions reported
to AUSTRAC);
- Any other data bases with which the ATO's data should be matched such
as Health Insurance Commission data, medicare records, fact of death
records, deregistered companies and others; &
- Opportunities for simplifying the refund process for exempt investors
(such as pensioners) with TFN withholding tax and the cost-effectiveness
of establishing their automatic identification.'
Mr Hawker said, 'In undertaking this work the Committee is appreciative
of the cooperation it has been promised by the ATO despite the big job that
the Tax Office currently faces in implementing tax reform'.
'The Committee also acknowledges the significant privacy sensitivities
surrounding this matter and these obviously will be given appropriate
attention.'
'The committee is now receiving submissions from interested organisations
and individuals for this inquiry', said Mr Hawker and, 'We encourage people
to have their say.' The closing date for submissions is Friday 22 October
1999.
Ends // 24 September 1999
Further information: David Hawker MP (Chairman) 03 - 5572 1100 (elec)
02 - 6277 4100 (parl)
Beverley Forbes (Secretary) 02 - 6277 4587
Email: EFPA.Reps@aph.gov.au
Committee Membership 39th Parliament
Chairman: Mr David Hawker MP
Deputy Chairman: Mr Gregory Wilton MP
Members:
Mr Anthony Albanese MP
Ms Anna Burke MP
Ms Teresa Gambaro MP
Mrs Kay Hull MP
Mr Mark Latham MP
Mr Christopher Pyne MP
Hon Alex Somlyay MP
Dr Andrew Southcott MP
For a copy of the Audit Report No 37 - Management of tax file numbers
see:
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