Tax Inspector-General to review ATO’s use of garnishee notices

The Inspector-General of Taxation (IGT), Mr Ali Noroozi has announced an investigation into the allegations made during the ABC Four Corners program, aired on 9 April 2018, regarding the ATO’s use of garnishee notices.

Garnishee notices are the most common form of firmer action used by the ATO to recover tax debt. Such notices require third parties to pay the money they owe to a taxpayer to the ATO in satisfaction of the tax debt owed by that taxpayer. Accordingly, the cash flow of affected taxpayers may be disrupted with potentially severe impact on vulnerable small businesses and individuals, Mr Noroozi said. “The allegations about the ATO’s inappropriate use of garnishee notices is of serious concern and, if not addressed, can affect community confidence in the administration of the tax system,” Mr Noroozi said. “As the Taxation Ombudsman, I have a duty to independently investigate these allegations to restore public confidence,” he said.

The Inspector-General is seeking submissions on the review and these are due by 22 June 2018.