Small business debt is a key target, ATO reveals

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“Targeted strategies” to recover small business debt with the aim of returning to pre-pandemic levels are one of the main areas of focus for the ATO in 2022-23, it says in its latest business plan.

The debt collection effort would “use data-driven insights” and “resume firmer and stronger deposit and payment activity” to address debt growth during COVID, though the ATO ” would balance debt collection with support for small businesses” as it revitalizes its tax function.

The objective was to reduce the ratio of recoverable debt to net tax collections to less than 6% by 2025-2026, compared to a level of 8 to 8.5% for the current year.

The focus on debt is one of seven key areas outlined in the business plan, which reveals a growing reliance on digital information.

Another goal would be the transition of the ATO to a “modern and secure IT infrastructure by moving to a new data center” and enabling even more digital investments by identifying efficiencies “[and] recalibrate certain areas of our work”.

Data collection is essential for all focus areas, which include the modern business register project, expanded use of STP, deepened cybersecurity, and the development of a “digital-first tax ecosystem” for small businesses. to improve their “fiscal performance and participation”.

In a foreword to the plan, Commissioner Chris Jordan said COVID showed the essential role the ATO is playing in supporting the community during a difficult time.

“We have provided life-saving stimuli to millions of people during the pandemic and proven that we are much more than a revenue collection agency,” he said. “We are at the forefront of government service delivery and we continue to undertake important programs of work. We are recognized as a leading tax authority in the world.

He stressed the importance of data collection as a way to get tax assessments right the first time, and said the ATO is aware of the need for increased security for the sensitive information it collects.

“Using data and digital is one of our most exciting and important areas of work. Data underpins our customer service, our early intervention activities, and our focus on prevention rather than correction. We simplify interactions and integrate what we can into natural systems so people can get things done with minimal intervention from us,” he said.

“Having one of Australia’s largest data stores, keeping our data secure is an important responsibility and is driving our focus on cybersecurity and the transition to the new data centre.

“Our data stores are growing every year, so it is paramount to keep our systems secure and protect the personal information entrusted to us by taxpayers.”

And he said the goal of settling collectible debts that arose during the pandemic would be offset by sympathy for the hardships of individual customers.

“With the substantial return to business as usual across the country, we are undertaking targeted strategies to address recoverable debts, reconnecting with customers to tailor solutions to their circumstances, and doing so with empathy and understanding,” he said. -he declares.

Small business debt is a key target, ATO reveals

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Last update: August 17, 2022

Posted: August 18, 2022

Philip King

Philip King

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Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, information and educational content for professionals in the accountancy and SMSF industries.

Philip joined the titles in March 2022 and brings extensive experience from various roles at The Australian national broadsheet daily, most recently as Automotive Editor. His background also includes spells in various consumer and trade magazines.

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