The ATO learned it was being scammed, then paid out millions more to fraudsters
The tax office traded people for programs and is still grappling with the consequences
No Return: Australia's Missing Billions
The ATO is one of the most powerful and secretive institutions in the country, but for years, it's operated without effective scrutiny. No Return: Australia's Missing Billions
In this major Four Corners investigation (YouTube) , award-winning financial journalists Neil Chenoweth and Angus Grigg reveal how inaction and flawed systems have allowed more than $50 billion in tax to go uncollected.
They unpick how a simple scam, supercharged on social media, saw tens of thousands of Australians fraudulently claim at least $2 billion in GST refunds.
They also show how corporate operators extracted millions more through fake invoices and phantom construction projects, often without triggering even basic checks.
And they expose how deep cuts, digital automation and a lack of independent oversight has left one of Australia's most powerful institutions wide open to exploitation.
Born of years of forensic reporting by two of Australia's most respected financial journalists in collaboration with the ABC's investigations team, No Return exposes systemic failures inside one of the nation's most opaque institutions.
It demonstrates why every taxpayer should demand accountability from the very agency entrusted to uphold it.
No Return, reported by Angus Grigg and Neil Chenoweth, and produced by Kyle Taylor, goes to air on Monday 28 July at 8:30pm on ABC TV and ABC iview.
Christine Milne on bsky Tax Commissioner Chris Jordan backed amnesty for offshore/ tax haven corps. What a surprise ABC4Corners
Calls for transparency after Keating’s $1m tax bill waiver Edmund Tadros Edmund Jul 25, 2025
Experts have called for the Tax Office to overhaul its opaque process for waiving penalties, warning that new laws making penalties non-deductible will increase the incentive for taxpayers to privately petition the agency to cancel charges.
The warning comes after it was revealed that tax authorities wrote off an almost $1 million tax penalty owed by former prime minister Paul Keating via one of his companies in 2015.
The ATO wrote off a large tax penalty owed by former prime minister Paul Keating, Louie Douvis
That decision, which reversed an earlier ATO refusal to waive the penalty, happened under laws that give the commissioner of taxation broad powers to cancel the penalties, known as a general interest charge (GIC), “where it is fair and reasonable to do so”.
A spokesman for the ATO said he could not comment on Keating’s tax affairs, citing confidentiality laws.
However, the agency noted in general terms that when deciding whether to remit a GIC it “considers the circumstances that caused the delayed payment resulting in GIC, how these circumstances prevented the taxpayer from paying by the due date and what steps they have taken to reduce the delay”. Keating could not be reached for comment.
Taxation Ombudsman Ruth Owen will review the way the ATO manages its process to waive tax penalties and report back by January 2026.
“We’re undertaking this review in response to taxpayer and community concerns about the ATO’s stricter approach to the remission of general interest charges,” she said. “This is a significant proportion of the complaints I receive as the ombudsman.”
Two other tax experts, including the former head of the watchdog, criticised the lack of a clear process around the ATO’s power to cancel tax penalties. Both experts made clear they were not commenting on Keating’s case.
Tax Ombudsman Ruth Owen will conduct a review of the way the ATO manages its process to waive tax penalties. Steven Siewert
“My observation would be the process to have your decision reviewed is not always clear and sometimes you can only navigate those processes with the assistance of an expert; and sometimes it matters who you know,” said Karen Payne, the former inspector-general of taxation and taxation ombudsman.
Payne said the ATO needed a mechanism to internally review decisions about tax penalties, but added that the agency needed to document how it made decisions “to ensure that everyone gets access to the same fair process”. All taxpayers have the option of appealing a penalty by writing to the ATO, but no detail is provided for how the decision is made.
“It seems to be very inefficient,” Payne said. “What you’ve set up is a process where if you don’t like the answer you just keep escalating, and that seems a time-consuming, inefficient use of public resources, not to mention the taxpayer. There should be good process and good direction upfront so you get the right decision.”
Karen Payne, the former inspector-general and taxation ombudsman, said the ATO needed a mechanism to internally review decisions on penalties. Brook Mitchell
Robyn Jacobson, senior advocate at The Tax Institute, said while “any taxpayer can ask for interest charges on tax debts to be reduced or removed, a process called remission by the ATO … the outcome can depend on the ATO person you are dealing with”.
“There are no objection rights and no ability to seek a review of the commissioner’s remission decision at the Administrative Review Tribunal,” Jacobson said. “The only option is to appeal to the Federal Court, which is costly and difficult.”
This, she warned, meant that “remission involving a high-profile taxpayer can leave the system open to the perception that there isn’t a level playing field and that more influential taxpayers can get a better deal”.
“It is not always clear the grounds on which the commissioner chooses to remit a tax debt,” Jacobson said. “Taxpayers need certainty, and transparency of process is fundamental to a good tax system.”
New law increases incentive to appeal
Both Payne and Jacobson said new laws that mean tax penalties are no longer tax deductible will create even more incentive for taxpayers to privately petition the ATO for a waiver. The measure, which came into effect on July 1, is expected to raise $500 million per year and comes amid a blowout in the size of the ATO’s collectable debt to more than $50 billion.
“I think by denying interest deductibility you will encourage more taxpayers to escalate when they have not [received] a remission from the interest charges,” said Payne.
Jacobson said the stakes for taxpayers who have been penalised were now higher because of the law changes. “This process must be transparent,” she said. “That’s the key to this.”
