This audit examined how well the Office of State Revenue (OSR) collects state taxes.
Our specific lines of inquiry were:
- Does OSR know the total value of taxes due to the state and how well it is collecting this amount over time?
- Does OSR know what its collection costs are and is it actively managing them?
To assess how well OSR collected taxes we looked at the value of collections over time and how they compared to tax estimates, the tax gap, and payment trends.
In assessing how well OSR managed its collection costs we focused on unit costs. Specifically, we looked at how much it costs to collect a defined amount of tax as well as to carry out key activities or services like issuing assessments and conducting audits and investigations.
In undertaking the audit we:
- researched literature on assessing tax office performance
- reviewed OSR’s strategic, business and operational plans
- analysed OSR’s tax collection goals and objectives, and the indicators it uses to keep track of them
- reviewed OSR’s programs and initiatives for improving efficiency
- interviewed staff responsible for various aspects of tax collection
- analysed data relating to these programs and initiatives to determine what impact they were having.
We did not review OSR’s payment of grants and subsidies.
Wherever possible we audited at least 3 years of information (from 2013-14 to 2015-16), to look for trends in performance. However, some relevant programs and initiatives only operated over part of this period.
We conducted this narrow scope performance audit under section 18 of the Auditor General Act 2006 and in accordance with Australian Auditing and Assurance Standards. Narrow scope performance audits have a tight focus and generally target agency compliance with legislation, public sector policies and accepted good practice. The approximate cost of tabling this audit was $367,000.