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The world will either be purposely shaped or inherited through complacency. Whichever, public servants will be leading it.
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Dorothy Brown (Emory), Colorblind No More(JOTWELL) (reviewing Jeremy Bearer-Friend (George Washington), Should the IRS Know Your Race? The Challenge of Colorblind Tax Data, 79 Tax L. Rev. 1 (2019)):
The summer of 2020 opened the eyes of many to the concept of systemic racism, and some even started looking in unlikely places – like tax law. Senator Sherrod Brown (D-Ohio) acknowledged in a June 2020 hearing that “Congress writes the tax laws. If there are ways that our current tax code exacerbates racial inequity, then it’s our job to fix it.”
Senator Brown’s articulated vision will be difficult to achieve because the Internal Revenue Service (“IRS”) does not collect or publish statistics by race. I confirmed this fact in a telephone interviewwith an IRS employee when I was writing one of my first pieces about systemic racism and tax policy over two decades ago. I was most interested in the distribution question – whether or not taxpayers were treated differently by race. (The answer is yes — they are treated differently. I write about this in a forthcoming book, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans—And How We Can Fix It.) But equally important questions were asked and answered by George Washington University Associate Professor of Law Jeremy Bearer-Friend, in his article: Should the IRS Know Your Race? The Challenge of Colorblind Tax Data. ...
It is a brilliant work of legal scholarship documenting the long history of the federal government’s fairly consistent failure to provide tax statistics by race. His painstaking research included not only combing through a myriad of forms and reports looking for race and ethnic data, but also using freedom of information act requests. (P. 16.) But the article’s most important contribution lies in the even-handed approach he takes as he provides potential explanations for the colorblind policy and that policy’s equally “troublesome consequences.” (P. 66.) ...
Making race and tax data publicly available is a choice whose time has come. In January President Biden signed an executive order requiring that racial equity become a focus of all government agencies. Professor Bearer-Friend’s path-breaking article can serve as a guide in the area of tax administration.
INQUIRY INTO ATO ANNUAL REPORT 2018-19 - PUBLIC HEARING TRANSCRIPT
The Inquiry by the House of Reps Committee on Tax and Revenue into the Commissioner of Taxation Annual Report 2018-19 held a public hearing on St Jozef's Name Day 19 March 2021
The Transcript shows the focus of that day's hearing was on the way in the ATO approaches cases of tax evasion. The submissions that the Committee has received are also available on the Parliamentary website.
The ATO’s data-matching to combat tax crime: How does it work?
The Australian Taxation Office (ATO) matches external data with its own to combat fraud and tax crime. If the ATO suspects that you are engaging in fraudulent activity such as not reporting all your income, they may check your financial records to see whether they match their internal data.
On its website, the ATO provides insight into its data-matching programs, and how it exchanges data with other Australian government agencies.
Data-matching programs
The ATO runs specific data-matching programs to understand industry trends and identify businesses that are not reporting all their income, operating outside of the system, or are not lodging tax returns.
Specific data-matching activities are undertaken across six key areas.
Credit and debit cards
While information is not obtained about individual credit or debit card holders, banks and financial institutions are required to report total credit and debit card payments received by Australian businesses to the ATO.
Further information is provided in the Credit and debit cards data-matching protocol.
Specialised payment systems
The ATO obtains data on electronic payments made through specialised payment systems such as PayPal, to Australian businesses. This data is analysed in conjunction with data collected through the credit and debit card data-matching program.
Further information is provided in the Specialised payment systems data-matching protocol.
Online selling
Data is obtained from online sellers who:
- Sell goods and services to the value of $12,000 or more.
- Have clients whose annual trading activity amounts to $12,000 or more.
- Operate a business in Australia that is governed by Australian law.
- Provide an online marketplace for businesses and individuals to buy and sell goods and services.
- Track the activity of registered sellers.
- Have trading activity for the time period in question.
Further information is provided in the Online selling data-matching protocol.
Ride-sourcing
Data is collected from all ride-sourcing facilitators operating in Australia, such as Uber, and their financial institutions. This data is used to identify ride-sourcing drivers and ensure that they are meeting their tax obligations.
Further information is provided in the Ride-sourcing data-matching program protocol.
Motor vehicle registries
The ATO obtains data from motor vehicle registries to ensure that individuals and businesses involved in buying and selling motor vehicles are meeting their tax obligations.
Data is collected for all vehicles sold or transferred where the value is $10,000 or greater.
Further information is provided in the Motor vehicle registries data-matching protocol.
Cryptocurrency
Cryptocurrencies such as Bitcoin are an attractive option for those who intentionally want to avoid tax responsibilities, but some people are genuinely not aware of their tax obligations relating to cryptocurrencies.
Data is obtained from Australian cryptocurrency designated service providers (DSPs) to ensure people trading in cryptocurrency are paying the right amount of tax.
Further information is provided in the Cryptocurrency data matching protocol.
Exchanging data with other Australian Government agencies
The ATO exchanges information collected from the data-matching program with a number of Australian government agencies including Services Australia, the Data-Matching Agency (DMA) – a separate agency within Services Australia – as well as with Centrelink, the Child Support Registrar, and the Department of Home Affairs.
These agencies work together to combat tax evasion, incorrect personal financial assistance payments, and to combat fraud within the welfare system.
Conclusion
Australia is taking a whole-of-government approach to combating fraud and tax crime. Key to this approach is the ATO’s data-matching program, which gathers essential data across a range of industries to identify instances of tax evasion and related misconduct. This data is exchanged with other government agencies, which collaborate to deal with people and businesses who don’t comply with their tax and super obligations.
Sometimes someone else summarises an issue better than you can. This is the Good LawProject writing about Priti Patel’s new Police, Crime, Sentencing and Courts
Read the full article…
