Voice for Change: Australian Perspectives on Tax Administration

Article excerpt

Introduction

Taxation nestles in a basket of activities that trigger a degree of societal discomfort. The discomfort arises from different kinds of ambivalences that are familiar and pervasive. On the one hand, taxation is a drain on our individual wealth, regardless of whether we are poor or rich. On the other hand, we pay taxes because we want to live in a democracy that aims to further the common good, even if we are mystified by how government interprets "the common good" from time to time. These sources of ambivalence are ones that are shared by members of any group who have given up individual freedom for a collective purpose. Other sources of ambivalence arise because we find ourselves at odds with each other, oftentimes with significant others in our families, workplaces, and community groups. Some in our society pay tax with a warm inner glow, others with looks that could kill. Still others find ways of escaping from their taxpaying responsibilities altogether. We look to tax authorities to do their job and make everyone pay. And at the same time, we cringe at the coerciveness of enforcement processes. At no time more so, than when we, as innocents, are caught up in unwieldy bureaucratic legalistic interpretation that puts us in the category of "the bad guy" of "tax cheat".

These varied depictions of taxation and its administration will strike a chord with most people. Surveys conducted by The Australian National University's Centre for Tax System Integrity (1) over the past three years have attested to the complex ways in which people respond to taxation, as well as to the deep ambivalence people feel on the subject. Incongruities between the social goals of equality and freedom, order and disorder, and between personal goals of what we should do, what we actually do, and what we see others do, unavoidably generate discomfort within and tensions among ourselves. Taxation, with its purpose of binding us together through ensuring a fair distribution of resources, is ironically grounded in conflict. In these circumstances, it is little wonder that institutions associated with taxation are segregated from other aspects of governance and civil society.

Of somewhat greater puzzlement is the way in which the social commentary on taxation that takes place in public space strips the topic of all its ambivalence and complexity. The public discourse on taxation can be summed up with three concepts: "at the taxpayers' expense", "tax minimisation" (of more recently "tax effectiveness"), and "tax cuts". The keywords represent abuse--abuse of power, abuse of privilege, and retaliation against abuse, real of imagined. For these reasons, mention of tax system integrity seems at best foolishly idealistic, a contradiction in terms to the many Australians who take their lead on tax matters from the media and popular culture.

How can a system that is publicly associated with abuse of the individual possibly aspire to the state of grace that is implied by the term integrity? This special issue of the Australian Journal of Social Issues has been compiled with the view that integrity is not only possible for tax systems, but also essential if democracy is going to work for the mass of the people that it supposedly represents. Integrity means no more than soundness of purpose and having the means for achieving this purpose that is respectful of democratic ideals and institutions. But in order to achieve integrity, the tax system and those who administer it have to engage with the people of the democracy with regard to what they are doing and how they are doing it. Integrity cannot be achieved if a tax authority listens only to experts and the government of the day. Experts provide understandings of consequences of actions and governments set directions for action, but people themselves hold the key to whether of not they will cooperate, in an administrative sense, with the tax authority. And their sophistication, or perhaps cynicism, about power and how it works means that cooperation cannot be bought cheaply. …