The Australian Taxation Office (ATO) is responsible for the effective management of Australia’s taxation and superannuation systems. This includes responsibility for achieving confidence in these systems by ‘helping people understand their rights and obligations, improving ease of compliance and access to benefits, and managing non-compliance with the law.'

The ATO’s purpose is to contribute to the economic and social wellbeing of Australians by fostering willing participation in the tax, superannuation and registry systems. The ATO’s Corporate Plan 2022–23 identifies the tax gap as part of a strategic objective.

The objective of the audit was to assess the effectiveness of the Australian Taxation Office’s arrangements for identifying and reducing the income tax gap for individuals not in business.

Key findings:

• The ATO is largely effective at identifying and reducing the tax gap for individuals not in business.
• The ATO is largely effective at developing, implementing, and communicating the tax gap methodology for individuals not in business.
• The ATO has sound processes for identifying and developing compliance strategies to address risks to the individuals not in business tax gap, though inconsistent application of ATO guidance undermines the effective implementation of these strategies.