Statement of Expectations 2014-16
I am pleased to provide you with this Statement of Expectations (SOE) for the State Revenue Office (SRO). This SOE applies for the period 2014-15 and 2015-16, or until otherwise amended.
Improving the administration and enforcement of regulation
This SOE sets out my expectations of the SRO's contribution to the Government's program to reduce red tape affecting businesses, not-for-profit organisations, government service providers and households by promoting greater efficiency and effectiveness in the administration and enforcement of regulation.
As the Treasurer, I am responsible for administering the Duties Act 2000, Land Tax Act 2005, Payroll Tax Act 2007, Congestion Levy Act 2005, First Home Owner Grant Act 2000, Taxation Administration Act 1997, Growth Areas Infrastructure Contribution and several other grants and subsidies that affect businesses and the broader Victorian Community. This SOE should be read within the context of the objectives, obligations and functions outlined in the above legislation as amended.
This SOE outlines key governance and performance objectives and targets aimed at improving the administration and enforcement of regulation and thus reducing its cost impact on business and the community.
Improvements and targets
Based on consultation between the Department of Treasury and Finance and the SRO, I have identified some key areas of governance and operational performance where there are opportunities for the SRO to make improvements that would reduce cost impacts on business.
I expect the SRO to achieve the following performance targets:
- reduce the number of Land Tax amendment requests as a proportion of total Land Tax assessments by 5 per cent;
- reduce processing time by 21 days for three types of duties transactions:
- late duties lodgements,
- unrelated sub-sale with off-the-plan concessions, and
- transfer to super fund exemption;
- improve the task completion score for the SRO web site to 2.1; and
- reduce calls relating to Duties Online password resets by 80 per cent.
In addition, I expect the SRO to:
- continue to use appropriate forums to advocate for Payroll Tax harmonisation (including legislative harmony and administrative consistency) across all Australian States and Territories; and
- continue to monitor public awareness and understanding of key areas of taxation administration to identify areas of poor understanding among taxpayers, and use a range of media to deliver timely, accurate and accessible information and advice to taxpayers.
Reporting on your progress to achieve these SOE performance targets should be undertaken in the context of annual financial reporting to avoid dual reporting streams. As part of annual reporting, regulators are expected to report on:
- current baseline levels for performance targets set in this SOE; and
- activities to be undertaken to reach the performance targets and improvements set out in this SOE.
I also expect that these SOE performance targets will be incorporated into the SRO's Corporate Plan, and this SOE should be published on the SRO's web site upon receipt.
Responding to this SOE
I look forward to receiving the SRO's response to this SOE, which will outline the activities the SRO intends to undertake to achieve the performance targets, by 1 July 2014. In developing actions to achieve these improvements and targets, the SRO is expected to consult with business and the broader community as appropriate.
I look forward to seeing the SRO continuously working towards achieving best practice in the administration and enforcement of regulation.
HON. Michael O'Brien MP
Response to Statement of Expectations 2014-16
1 July 2014
The Hon Michael O’Brien MP
Level 4, 1 Treasury Place
MELBOURNE VIC 3000
Response to your Statement of Expectations for the State Revenue Office
Thank you for your letter dated 13 June 2014 which set out your Statement of Expectations (SOE) for the State Revenue Office (the SRO) with respect to improving our administrative practices as part of the red tape reduction program. Your letter has been published on the SRO website at www.sro.vic.gov.au.
The SRO administers Victoria's taxation legislation and collects a range of taxes, duties and levies. In 2012-13, we collected in excess of $11 billion in revenue for the Victorian Government. It is our mission to provide customers with quality revenue management services that are fair, efficient and deliver benefits for all Victorians. The SRO is also committed to continually improving the administration and enforcement of the taxation legislation and thereby reducing its cost impact on business and the community. The SOE performance targets are consistent with our mission and commitment to all Victorians.
The SRO is committed to achieving all the improvements and targets set out in the SOE in the following manner:
Reduce the number of land tax amendment requests as a proportion of total land tax assessments by 5 per cent
The SRO is currently developing an improved land tax system that will:
- verify customers’ data and confirm with the customer prior to the land tax assessment cycle; and
- increase automation and thereby provide customers with an improved and more efficient self-service capability to ensure that their land ownership information held by the SRO is correct prior to being issued with an assessment.
The early communication with customers to confirm details will assist with better land tax compliance and ensure that land tax assessments are correctly issued the first time. The new land tax system will also provide land taxpayers with a better understanding of their tax obligations and bring forward certainty in relation to their land tax liability. For these reasons, it is envisaged that this new land tax system would result in a reduction of land tax amendment requests as a proportion of total land tax assessments by at least 5 per cent.
Reduce processing time by 21 days for three types of duties transactions – late duties lodgements; unrelated sub-sale with off-the-plan concession and transfer to super fund exemption
Our Duties Online system was introduced in October 2011, and it has been very well received by our customers. Duties Online allows registered users to electronically submit details of the most common types of property transfers and Declarations of Trust for assessment, all from the convenience of their office. In the case of a land transfer, it will no longer be necessary to have the Transfer of Land stamped. Instead, when the electronic transaction is finalised and paid or exempted, Duties Online will instantly transmit confirmation of the duty assessment to the Registrar of Titles. The confirmation details are stored in the Registrar of Titles database until the Transfer of Land is lodged for registration. The details are then used to confirm that the duty obligations have been met.
Currently, late duties lodgements, unrelated sub-sale with off-the-plan concession and transfer to super fund exemption cannot be lodged through Duties Online and require 21 days of manual processing time for each transaction. The SRO is working on expanding our online service to include these three categories of transactions in our Duties Online System which will enable such transactions to be processed in real time.
Improve the task completion score for the SRO web site to 2.1
With approximately 13 million page views and 3.2 million visitor sessions in 2012-13, the SRO website is one of the most frequently visited among Victorian Government websites. Among the many purposes for visiting the SRO website, visitors advised that their primary purpose ranges from gathering general information to specific transactional based information. Over the years, the SRO has been continually looking for ways to improve the overall design, look and function of the SRO website.
Recently, the SRO has engaged a usability expert consultancy group to undertake a usability study of our website with the objective of using the findings and recommendations to re-design and re-build the website in 2014-15. As part of the usability study, moderated user testing was conducted and a benchmark was created. At some stage after completing the website re-design and releasing the new system, the SRO intends to commission another usability test and aims to improve the task completion score to 2.1 or lower. The task completion score ranges from 1 (being the perfect score) to 4.
Reduce calls relating to Duties Online password resets by 80 per cent
To protect the security and integrity of our customers’ information on our Duties Online system, their passwords are required to be changed every month. For this reason, it is a natural occurrence that passwords are forgotten. Currently, the SRO receives in excess of 1,200 phone calls each year from customers requesting assistance to reset their forgotten passwords.
The Duties Online system is operational from 7am to 7pm and the SRO business hours (where business support for Duties Online is available) are 8:30am to 5pm on weekdays. This means that the SRO may not always be available to assist Duties Online users with their password resets.
We are working to enhance our Duties Online self-service facilities to enable our customers to electronically reset their forgotten passwords safely without needing to contact our office. With the self-service option in place, it is envisaged that there will be a reduction of phone calls relating to Duties Online password resets by 80 per cent.
Continue to use appropriate forums to advocate for Payroll Tax harmonisation (including legislative harmony and administrative consistency) across all Australian States and Territories
In 2007, I and the other Commissioners of the revenue offices across all Australian States and Territories committed to the harmonisation of Payroll Tax administration. Since then, all jurisdictions have fully harmonised in eight key areas and six jurisdictions (Victoria, New South Wales, Tasmania, South Australia, Northern Territory and Australian Capital Territory) have implemented harmonised legislation.
In addition to legislative harmony, the SRO and its counterparts are committed to achieving administrative consistency by working closely together through a number of inter-jurisdictional committees. In 2008, the Payroll Tax Harmonisation Committee (PTHC) was set up to oversee the resolution of teething legislative and administrative issues relating to the introduction of payroll tax harmonisation. In 2012, the PTHC was subsumed into the Tax Law Committee which is now the forum used for ensuring legislative harmony for payroll tax in addition to advancing national tax law issues (including policy, legislative, interpretative and technical issues that have national implications) in the other revenue lines. The Payroll Tax Harmonisation Revenue Rulings Sub-Committee which was established soon after the PTHC and is still in operation, provides the forum for ensuring harmonisation in payroll tax Revenue Rulings. The majority of jurisdictions have harmonised their Payroll Tax Revenue Rulings. Victoria and New South Wales have published close to 40 joint Revenue Rulings.
Where an employer operates in more than one of the States and Territories with harmonised payroll tax legislation, the relevant Revenue Offices of each State and Territory will consult one another and share relevant taxpayer information in determining private rulings and objection matters.
To ensure consistent outcomes in audit matters, the SRO:
- works together with the other jurisdictions to conduct joint audits of large employers who operate in a number of States and Territories;
- engages in direct discussions on particular payroll tax audit matters with the other jurisdictions; and
- participates in the annual Compliance Conference and bi-monthly Compliance Teleconference to discuss, among other things, particular payroll tax audits.
The SRO is also an active participant of the Training and Customer Education Committee which oversaw the following achievements to date:
- The launch of the harmonised payroll tax website at www.payrolltax.gov.au;
- The development and delivery of harmonised payroll tax webinars;
- The release of a number of payroll tax harmonised YouTube videos that address payroll issues that apply across the states – these were developed by the Victorian SRO and we will continue to play an active role in the production of future videos where the need arises; and
- The sharing of training materials to ensure that staff in the revenue offices of all States and Territories receive similar payroll tax training.
The Commissioners’ Business Practices Committee also looks for opportunities to harmonise administration across jurisdictions. This group plays a role in identifying better practices in various jurisdictions and sharing that information with others so that they can apply those benefits to their own jurisdictions.
The SRO will continue to use the above forums to advocate for payroll tax harmonisation across all States and Territories.
Continue to monitor public awareness and understanding of key areas of taxation administration to identify areas of poor understanding among taxpayers and use a range of media to deliver timely, accurate and accessible information and advice to taxpayers
The SRO provides a range of educational services to customers across all revenue lines. These include the annual payroll tax seminar and webinar program which is held across May and June each year as well as a free service to register for updates to Revenue Rulings, publications and forms issued by the SRO. The Victorian SRO is the leader in the provision of webinars for its payroll taxpayers. The SRO website also provides general information along with access to Revenue Rulings, Circulars and Bulletins.
We are continually enhancing our customer education activities and striving towards improving compliance related assistance and advice by translating tax information into easily accessible and cost effective format for our customers. Currently, the SRO adopts a number of avenues to identify opportunities to tailor our customer education activities to improve our customers’ (and their representatives’) understanding of taxation administration including the following methods:
- Through frequently asked questions received by our Customer Contact Centre, the SRO creates easy to understand online videos addressing the issues in these questions.
- To ensure that customers are correctly advised of their compliance obligations, the SRO responds to requests by professional groups and firms to provide specific information to their members and staff.
- As part of the SRO Compliance Strategy, we identify particular risk areas of the relevant legislation or industry types for possible non-compliance through comprehensive analysis and data matching processes. This information is then used to target our education and define our compliance focus. Each year, our compliance focus for each revenue line is published on our website. An important aspect of the SRO compliance activities is to develop customer education programs tailored to addressing non-compliance issues.
The SRO will continue to apply the above methods to ensure that our customers and their representatives have a clear understanding of their taxation obligations.
In the SRO Annual Review for 2013-14, we will report on the current baseline levels for all the performance targets set in this SOE and the activities that will be undertaken to achieve these performance targets.
I am pleased to advise that I have incorporated in the SRO Business Plan 2014-15 and I will incorporate in the SRO Business Plan 2015-16, all the performance improvements and targets in your SOE as well as the specific activities that we have committed to undertake.
The SRO will report the progress of all our targets in our Annual Review for 2014-15 and the achievements relating to these targets in our Annual Review for 2015-16.
I look forward to continually working towards achieving best practice in the administration and enforcement of regulation.
Paul Broderick PSM
Commissioner of State Revenue