ATO Planning ACNC Takeover

The Australian Tax Office has started planning to take over the regulatory roles of national charity regulator the ACNC, a Senate Estimates hearing has been told.

The Commissioner of Taxation, Chris Jordan is said to have told the Senate Estimates hearing in Canberra that he expected interactions with the sector to be “quick and painless”.

The CEO of the NFP peak body, Community Council for Australia, David Crosbie said that while the answers of the Taxation Commissioner make it very clear that the government is looking at returning regulation of charities and Not for Profits to the Australian Taxation Office, just how this is to be done remains unclear.

“Answers given by the ACNC Commissioner to questions asked by Senator Siewert indicate that the government has not engaged in consultation with the sector on this issue, and is not interested in hearing the views of the current regulator despite the very high level of knowledge and expertise within the ACNC.  

“This is disappointing to say the least,” he said.

The ATO also told the Senate Estimates hearing that it would need additional resources if it was to take on the charity regulator role.  

“This makes it clear that there are no real cost savings in closing down the ACNC,” Crosbie said.

“The argument that the ACNC is a big new costly bureaucracy conveniently ignores the fact that if it went, the government is looking at replicating many of its functions by increasing the role of the bureaucracy.  

“The bottom line is – someone still needs to decide who is or who is not a charitable organisation – will it be the ATO or the ACNC?

“Questions asked by Senator Bushby indicate a lack of knowledge about the differences between the operational structure and function of the ACNC and the associated Australian charities legislation; and the structure and function of the UK charities regulator, with its laws placing a much greater emphasis on demonstrating public benefit.

“To imply the ACNC is based on a failed UK model ignores the facts,” Crosbie said.

“To the contrary, in the same report that criticises the approach of the UK regulators, the views of the ACNC Commissioner are cited as examples of good practice.  Ireland, Hong Kong and Brazil are now establishing charities regulators.  

“Australia is seen as a model to be replicated, not the UK,” he said.

After last night’s hearing, the ACNC Commissioner commented on the discussion around the influence of international models of charity regulation on the establishment of the ACNC.

"In setting up the ACNC, we had the privilege of being able to draw on lessons learned by international charity regulators. Multiple models of international charity regulation were considered and our colleagues overseas were very generous in sharing what worked well and what didn't,” Susan Pascoe AM said

"We are now in a position where we have actually been able to leapfrog ahead of other regulators by learning from their work."

"What is unique about the ACNC is the objects of the ACNC Act. They were developed in consultation with the Australian charity sector, to suit the sector's distinct needs, and they are the foundation of what we do."

She said the ACNC's objectives are to:

• maintain, protect and enhance public trust and confidence in the sector through increased accountability and transparency
• support and sustain a robust, vibrant, independent and innovative Not for Profit sector
• promote the reduction of unnecessary regulatory obligations on the sector.