1. The Australian Taxation Office Information Management and Analytics
The Australian Taxation Office
Information Management and Analytics
Dr Richard Tait – IT Strategic Advisor
Australian Tax Office
Updated: 14/10.03
Source: Various
Done by: Richard Smith

2. A snapshot of the ATO
We collect 92% of the Australian Government’s revenue.
We manage:
 10 Million personal taxpayers
 3 Million business and non-profit organisations, and
 regulate around 240,000 self managed super funds.
Each year we handle over 11 million telephone and up to 1 million written enquiries.
Updated: 14/10/03
Source: Managing the revenue system for Australia
Done by: R Tait

3. We allocate our resources based on risk
The ATO’s Strategic Direction and Business Model call for a differentiated service
OUR BUSINESS MODEL
We verify compliance using a risk management approach
Individuals and
Businesses
self - assess
We manage relationships and differentiate accordingly
We shape internal and external capabilities 
We make it as easy as possible to comply    
When we say easier, we mean making it easier for clients to comply with their obligations.
Cheaper means making it cheaper for clients by reducing the workload, time and effort needed to meet their obligations.
By more personalised we don’t mean providing a service tailored individually to every single client. We mean being able to always offer products and services that make sense to clients, that fit with the systems they use in their day-to-day lives as much as possible.
All of us - the community, tax practitioners and the ATO have been through a fairly major change with the introduction of the new tax system.
Now as the system is bedding down - it is clear that some community expectations of their ease of interaction with the tax system are not being met.
This change program is about closing these gaps - to make it easier, cheaper and more personalised for people to interact with the tax system.
Just want to take a moment to put the change program in the context of our ATO business model.
(walk through the model)
Our compliance program is at the heart of how ‘we verify using a risk management approach’, and the change program is our key approach to making it easier for people to comply.
The compliance program and the change program are also strongly related - to have good compliance you need for people to find it easy to comply.
Use examples of some work done with Tax Agents on the portal as part of Listening to the Community. Almost at the end of the exercise we found that very few in the group and the required firewalls on their systems to all on electronic exchange with ATO.
We allocate our resources based on risk

4. The ATO’s Change Program is a key part of this strategy
Working with the Community to make paying tax:
Easier - Easier for clients to comply with their obligations
Cheaper- By reducing the workload, time and effort to meet obligations
More personalised - Offering products that make sense to clients
This requires services that are differentiated:
To make taxpaying easier for low risk, compliant clients
To place more focus on high risk, non-compliant clients
When we say easier, we mean making it easier for clients to comply with their obligations.
Cheaper means making it cheaper for clients by reducing the workload, time and effort needed to meet their obligations.
By more personalised we don’t mean providing a service tailored individually to every single client. We mean being able to always offer products and services that make sense to clients, that fit with the systems they use in their day-to-day lives as much as possible.
All of us - the community, tax practitioners and the ATO have been through a fairly major change with the introduction of the new tax system.
Now as the system is bedding down - it is clear that some community expectations of their ease of interaction with the tax system are not being met.
This change program is about closing these gaps - to make it easier, cheaper and more personalised for people to interact with the tax system.
Just want to take a moment to put the change program in the context of our ATO business model.
(walk through the model)
Our compliance program is at the heart of how ‘we verify using a risk management approach’, and the change program is our key approach to making it easier for people to comply.
The compliance program and the change program are also strongly related - to have good compliance you need for people to find it easy to comply.
Use examples of some work done with Tax Agents on the portal as part of Listening to the Community. Almost at the end of the exercise we found that very few in the group and the required firewalls on their systems to all on electronic exchange with ATO.

5. The behaviour of taxpayers is driven by many forces …
Sociological
Economic
Industry
Business
Psychological

6. This means that we need different compliance strategies for different behaviours
Have decided not to comply
Use the full force of the law
Create pressure down
Don’t want to comply
Deter by detection
Try to, but don’t always succeed
Assist to comply
Attitude to Compliance
Compliance Strategy
Willing to do the right thing
Make it easy

7. Information Management and Analytics are key to delivering this step change
Data Analytics
Rules and Treatments
Differentiated Service
Risk based resource allocation
For the taxpayer
Individual
Company
Other

8. Information Management
The first priority is high quality information
This requires management of work practices, client interactions, accountabilities, data sources, data flows and technology
The work is expensive and the business case is unexciting in isolation, but it is essential for the end result
Differentiated Service
Risk based resource allocation
Rules and Treatments
Data Analytics
Information Management

9. A key risk is that the outputs will not be understood and/or used
Analytics
Analytics requires high quality data and a clear derivation path, so that the resultant actions are defensible as fact based
The Analytics Capability is as much about human intelligence as technology – neither can succeed without the other
A key risk is that the outputs will not be understood and/or used
Differentiated Service
Risk based resource allocation
Rules and Treatments
Data Analytics
Information Management

10. Rules and Treatments
Once you have your potential decision points, you need to turn them into rules and treatments
e.g. “If the client is a Plumber, does not use a tax agent and is claiming more than $5,000 in work-related expenses – request a detailed schedule before approving a refund”
This requires “rules engines” of widely varying levels of sophistication
Key issues here are: throughput, performance and management of large numbers of rules
Differentiated Service
Risk based resource allocation
Rules and Treatments
Data Analytics
Information Management

11. Finally, the differentiated service …
Now, how will you justify your actions to your clients?
- “The reason we are taking longer to process your refund is that we think you are high risk”
Are the services consistent with the level of real risk?
Are they fair relative to other taxpayers?
What about the mistakes?
Differentiated Service
Risk based resource allocation
Rules and Treatments
Data Analytics
Information Management

12. Summary
The ATO is strongly committed to creating a differentiated treatment of taxpayers, consistent with their attitude to compliance
This will allow resources to be focused on high-need areas
It will reward taxpayers with good behaviour by fast, easy service
This relies completely on high quality information, sophisticated analytics and excellent execution

13. …or email: richard.tait@ato.gov.au
Questions?
…or