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Thursday, 27 March 2003
Page: 13879


Mr SLIPPER (Parliamentary Secretary to the Minister for Finance and Administration) (10:41 PM) —I move:

That the further amendments be agreed to.

These amendments are amendments that the government is prepared to accept. The Inspector-General of Taxation Bill 2002 has been passed with amendments by the Senate. To ensure that there is a clear and unequivocal understanding of the role and responsibilities of the inspector-general, clause 3 of the bill has been expanded. The clause now specifies the role of the inspector-general in improving the administration of tax laws, the independent nature of advice being provided by the inspector-general, and the ability of the inspector-general to identify systemic issues. It should be clearly evident now to all taxpayers what is trying to be achieved by this legislation: improved administration of the tax laws for the benefit of all taxpayers.

The government wants to ensure that any systemic tax administration issue can be reviewed by the Inspector-General of Taxation. At the same time, the government has made it clear that the operations of the inspector-general should be open and transparent. The government is therefore proposing an amendment to clause 8(2) of the bill, which would ensure the minister is still able to direct the Inspector-General of Taxation to conduct a review. The amendment would, however, allow the inspector-general to prioritise that direction after taking into consideration his or her other work priorities in accordance with clause 9 of the bill. The amended clause provides that the inspector-general need not immediately commence a review directed by the minister. The inspector-general may continue or start other reviews which the inspector-general considers have a higher work priority. The inspector-general has ultimate discretion in prioritising his or her work program. Clause 41 remains, whereby the inspector-general must outline in his or her annual report to the parliament any directions given by the minister to conduct a review.

The final amendment relates to when reports by the inspector-general would be publicly released. I note that the government agreed that it was important for the inspector-general's reports on reviews into systemic tax administration issues to be released publicly to maintain the respect and cooperation of taxpayers and their advisers. However, there is also a need, in many instances, for the government to release a response to the inspector-general's recommendation to avoid ambiguity for taxpayers. The government has therefore decided to amend clause 11 of the bill to require the minister to table or publicly release a report by the inspector-general within a specified time frame. Normally this would be within 25 sitting days of the minister receiving a report. The amendment also provides that the inspector-general may recommend that, due to special sensitivities or complexities in a particular report, the publication deadline may be extended. The government believes this amendment addresses some concerns raised about transparency of the inspector-general reports, while at the same time addressing the legitimate concern to ensure that the public release of reports is done in such a manner as to avoid unnecessary speculation or uncertainty in the tax system.

In conclusion, I note that the amendments to the bill maintain the government's commitment to establish an Inspector-General of Taxation to strengthen advice to government on tax administration, to be an advocate for the concerns of taxpayers and also to respond to stakeholder views. In particular, the three amendments provide greater clarification of the inspector-general's role and responsibilities. The passage of these amendments will enable the establishment of the office of Inspector-General of Taxation and will support an improvement in tax administration for the benefit of all taxpayers. I commend the amendments to the House and I present a supplementary explanatory memorandum.