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Government report says ATO denies “justice for small business”

Thursday, July 05, 2018

Following the ABC Four Corners program ‘Mongrel Bunch of Bastards’ alleging Australian Taxation Office abuse of small business people, the first of three government-ordered reports was released yesterday.

The report from Small Business Ombudsman Kate Carnel states that the ATO has “serious system-wide issues” that result in “…fundamental denial of access to justice for small business.”

The government report is a huge rebuke to the ATO that has consistently said ‘nothing to see here folks!’ and ‘it’s all a beat up’ and that the people profiled in the ABC show were stupid and suggesting they were tax cheats.

There was great scepticism that the reports ordered by the Minister for Revenue, Kelly O’Dwyer, would be a whitewash to protect the ATO. But no! The Minister deserves congratulations for allowing a genuine search for the truth.

The Small Business Ombudsman’s report studied the cases of over 100 small businesses who requested assistance. Based on this fact-finding examination of actual cases, the Ombudsman reports that the ATO:
  • Operates its systems to target revenue collection.
  • Can even (and does) take away ABNs, thereby stopping businesses from operating.
  • Raids people’s bank accounts even before taxpayers have any knowledge there is an issue.
  • Lacks true independence in terms of its internal review processes.
  • Does not provide adequate compensation for its own wrongdoing.
The Ombudsman talks of:
  • Abuse of ATO power.
  • ATO delays on decisions so that it can collect debt.
The Ombudsman's report is totally consistent with the allegations we have been making against the ATO for more than five years.

The Ombudsman calls for major ATO reforms including:
  • The creation of a fully independent low cost external review mechanism that is binding on the ATO.
This is consistent with our campaign for a Small Business Tax Tribunal.

The Ombudsman's report reaffirms our foresight in organizing Tax Audit Investigation Insurance coverage for our Protected Members. Join here.

We need major reform to the ATO. But small business people also need effective capacity to defend themselves if they come under ATO attack.

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