Powers of Australian Taxation Office and Need for Power Reduction

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AUSTRALIAN TAXATION LAW
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Introduction
Australian Taxation Office (ATO) is a statutory body or agency vested with powers and
authority to collect taxes in the country of Australia. It has responsibilities of administering
superannuation legislation and governing the smooth running of all the federal revenue collection
or taxation system within Australia1. In the Australian government, it’s considered to be one of
the most strongest and powerful institutions. It has powers which are related to law enforcement
bodies and the police. Therefore, this organization was granted powers by the state to audit
running business both small and big within the country to detect tax fraud. It does not only have
such powers but also has a right to apprehend and offer hefty punishments to the convicted in
case when they fail to prove their innocence.
The agency also possesses powers to carry out a search of one's property minus issuing a
warrant. All these powers are offered by the legislature in order to fight tax fraud and evasion
within the country. One of the powers held by ATO that has left citizens perplexed and
unsatisfied is its ability to divert small business incomes to themselves through instructing the
banks holding small business accounts. This is usually conducted in case of failure of small
business to pay off their debts2.. There is need to reduce on the extra-ordinally powers granted to
this office, this would give small business operators relief. The Sydney Morning Herald reported
1 ADAM Zuchetti, ATO lambasted for abusing ‘unbridled power’, 09 April 2018.
https://www.mybusiness.com.au/management/4152-ato-lambasted-for-abusing-unbridled-power
2 Adele Ferguson, Lesley Robinson & Lucy Carter, ATO raids tax office whistleblower amid Fairfax-Four
Corners investigation.P.4. The Sydney Morning Herald, 4 April 2018.

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one of the culprits "Kathryn" who ran broke and her ability to pay bil3ls and feed herself was
snatched away by ATO. The office abruptly cancelled her ABN (Australian Business Number).
She is among the few to report but there are a lot of individuals out there whose businesses are
taken as surety or permanently confiscated without warning or any notice.
There is need to monitor the different services that are carried out by this office so as to offer
protection to the small businesses. Some of the powers granted to the office include issuing out
formal notices where business owners are required to "give responses to written questions,
basing on one's understanding and knowledge”, “give evidence through attending their
interviews as well as answering oral questions", "produce documents to their offices". These
powers granted to the office by "Federal Court" under "Administrative Decisions (Judicial
Review) Act 1997" have created more financially handicapped individuals thus rising a need for
power reduction. In case of failure to reduce on power of the ATO, the legislature should
formulate possible policies to ensure that small business owners are protected. This should be
carried out through different measures such as; ensuring that income diverts by the ATO should
only and only be conducted through thorough warning of the business owners, search should be
conducted in possession of a search warrant inorder to avoid tarnishing of business name
(character assassination). The Australian Tax office needs to revise its behaviors and actions
towards the less wealthy taxpayers. These actions involve application of unfair legal advantages
3 Annual Plan (PDF). Australian Taxation Office. p. 3. Archived from the original (PDF) on 17 October
2013