ATO told to work with industry funds
The Australian Taxation Office (ATO) has been told it should work with superannuation industry stakeholders, including industry funds, to quickly identify employers who have failed to comply with paying the superannuation guarantee obligations.
An Auditor-General's Report, tabled in the Parliament this week, has pointed to the desirability of the ATO working with stakeholders to overcome the problem of superannuation guarantee non-payment.
It said many superannuation industry external stakeholders (including industry superannuation funds, superannuation debt collection services and the Fair Work Ombudsman) had early visibility of possible non-compliance and conducted compliance activities.
"Developing a closer relationship with these stakeholders would enhance the ATO's risk identification processes and allow the ATO to more promptly and effectively address non-compliance," the Australian National Audit Office (ANAO) report said. "There is also potential for the ATO to increase the use of external compliance information sources, in order to undertake a more complete analysis of non-compliance with SG obligations."
The report concluded that, overall, the ATO's administration of the Superannuation Guarantee Scheme had been generally effective, "particularly having regard to the scale of the Scheme and substantial flow of legislated revenue generated".
"Nevertheless, to better target its activities and more effectively promote employer compliance with SG obligations, the ATO should gain a greater understanding of the levels of non-compliance with SG obligations across industry sectors and types of employers," it said.
The report said the ATO's public assessment was that, ‘overall employers demonstrate high levels of voluntary compliance', but the ANAO said this view was largely based on total employer contributions as a proportion of total salary and wages and did not adequately reflect the level of non-compliance in specific groups of employers and industry sectors.
"The ATO's own internal risk assessment indicates that as many as 11 to 20 per cent of employers could be non-compliant with their SG obligations, and that non-compliance is ‘endemic, especially in small businesses and industries where a large number of cash transactions and contracting arrangements occur," it said. "Importantly, this non-compliance primarily affects lower paid employees and those are most likely to rely on the age pension in later years."
