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Improving Australia’s Tax Consultation System

Background

In December 2004, the Board was asked, in conjunction with Treasury, to review international consultation processes with a view to identifying any improvements to the Australian tax consultation system, especially in respect of non-controversial minor policy or technical amendments, and report to government.

Working Party and Consultation

In 2005, the Board and Treasury established a joint Working Party, chaired by Mr Keith James, to conduct the review. The Working Party’s intention in undertaking the review was to provide the Government with a set of recommendations on which there was already broad agreement, within and outside Government, in the tax consultation system.

The Working Party met with a wide range of stakeholders in the Australian system to understand better the current tax consultation processes and to gather information on whether international practice might be relevant to Australia. In particular, the Working Party met with peak industry groups, tax expert groups, regulatory bodies, officials from the Treasury and the Australian Taxation Office and state government treasury and revenue departments.

The Working Party considered information on tax consultation practices from Canada, France, Germany, Ireland, Korea, the Netherlands, Norway, Sweden, the United Kingdom, New Zealand and the United States.

Board Report

The Report prepared by the Board in conjunction with Treasury noted that since 2002 there have been significant improvements in tax consultation arrangements and they are now consistent with international practice, generally functioning well and have community support. As a result, the recommendations outlined in the report are for evolutionary change to the tax consultation system, within the broad framework of the existing arrangements developed in response to the Board’s 2002 report.

Government Response

On 15 August 2007 the then Treasurer announced that the Government had endorsed the recommendations  made in the report on ways in which Government, officials, external stakeholders and the Board itself can work together to improve Australia’s tax consultation system.

The Chairman of the Board of Taxation, Mr Richard Warburton, welcomed the Treasurer’s endorsement of the recommendations noting that they are directed at all participants in tax consultation processes and that the Board intends to work closely with all concerned for their implementation.

For further information about this report please contact the Board of Taxation Secretariat on (02) 6263 4366 or at taxboard@treasury.gov.au.

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