other and clients d to offer solutions that are in the community interest while

Other and clients d to offer solutions that are in

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other and clients; (d) to offer solutions that are in the community interest, while matching the individual circumstances of clients; and (e) to meet internal and external obligations (Australian Taxation Office, 2000a, p. 2). To effect these principles, the ATO has 12 standards expressed in the Taxpayers’ Charter to guide tax officers in their dealings with taxpayers in the course of administering the tax system (Australian Taxation Office, 1997): Taxpayers are to be treated fairly and reasonably, to have their privacy respected, to be treated as honest in their tax affairs unless the taxpayer acts otherwise, to have decisions explained to them, to be offered assistance, advice, and information in a professional way, and to be helped to minimize their costs in complying with tax law. Even at the level of general principles and codes of conduct, tensions arise. For example, is maximizing revenue collected ‘to support and fund services for Australians’ compatible with abiding by the Charter so as to ‘be open and accountable’? In theory, the answer is yes, but field staff sometimes appear to be less sure (see Job and Honaker, Chapter 6, this volume). The tension can be illustrated through the following questions: Are authoritarian tactics justified in cases where tax officers are chasing down taxpayers who are evading their tax? Or to put it another way: Are Charter consistent tactics costly for a tax office and the public when dealing with unscrupulous tax evaders? In order to ease these challenges to system integrity, the ATO adopted their Compliance Model (see Braithwaite, Chapter 1, this volume for a full description). Persuasion and education are the preferred methods for eliciting compliance and are assumed to be the most appropriate starting point for dealing with non- compliance in the absence of information that the wrongdoing is deliberate and likely to be repeated. In this way, the intentions behind the Taxpayers’ Charter are put into practice. While education and persuasion denote the preferred starting point, tax officers and taxpayers know of a range of sanctioning options that can be and will be brought into play should taxpayers fail to cooperate. Consistent with the Charter and in keeping with the ATO’s obligation to protect the revenue, the Compliance Model puts taxpayers on notice that tax officers will systematically increase the costs of non-compliance, while always holding the door open for a more responsive and cooperative relationship. In this way, the Compliance Model
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Tax System Integrity and Compliance 273 guides the ATO toward using its full enforcement capacity only when taxpayers have clearly or repeatedly signalled unwillingness to cooperate. At the level of principles and codes of practice, the integrity story within the ATO is quite impressive. But action does not flow directly from these principles and codes. There is another plank that is necessary to define the way in which tax officers and taxpayers should interact in pursuit of the ultimate goal of supporting the Australian democracy, tax law. Tax law provides the rules that determine
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  • Fall '16
  • tax authority, Australian Taxation Office, Tax Office, Compliance Model

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