The Internal Revenue Commission (IRC) unveiled its revamped debt allotment letters, signaling a significant step towards clearer communication with taxpayers and tax agents.
This is in line with IRC’s desire to communicate with taxpayers and tax agents through one of their projects part of the broader Taxpayer Services Strategy to foster voluntary compliance.
IRC wants to make sure they are as clear as possible, with all their interactions, so that taxpayers and tax agents understand their obligations and the consequences of non-compliance. By delivering messages clearly, there is less room for misunderstanding.
The launch event, was held on May 15th, at the Revenue Haus - Downtown, Port Moresby, attended by prominent figures from both the IRC and Australian Taxation Office (ATO) coming together to celebrate the culmination of months of diligent work. ATO has supported IRC in this important work.
These new letters convey the same messages and have the same demands as the old letters – the content is not new, the look and feel is.
Commissioner of Taxation, Mr. Samuel Loi, said, “The launching of the Letters achieves the 2023 IRC corporate plan to make voluntary compliance easier for our taxpayers or foster voluntary compliance, which is one of the pillars in the IRC’s Corporate Plan.
“Under the Taxpayer Services Strategy, the New Improved Letters Project developed by the Debt Collection Operations Team with the assistance of our ATO partners has made it simple and easy for Taxpayers to understand.”
This batch of letters includes:
- lodgment and payment reminders and requests,
- garnishee notices
- departure prohibition orders
- payment agreement notifications
- certificate of compliance communications
- GST and SWT application notifications
- and audit notifications.
Despite their modern appearance, these letters retain the IRC logo. Recipients are advised to note that these letters are legitimate communications from the IRC, not scams. The importance to read and understand the requirements outlined in the letter and take necessary actions promptly is adviced.
IRC Commissioner General Mr Sam Koim OBE, in his address, underscored the importance of providing comprehensive information to taxpayers, emphasizing the need for clear reasoning behind adverse decisions.
“When I came to the IRC and I saw a couple of letters that were written, generic ones that were sent to text phase, text phase were constantly asking why am I sending this letter. Sometimes they told me and I tried to even make a sense out of it.”
“If you are taking an adverse decision against the text phase, you've got to give the reasons. And then also cite where they have defaulted and the law that was breached. So, insufficient information was provided and that's where this project is initiated to at least draft templates for clear information.”
Koim also highlighted the IRC's commitment to supporting taxpayers in financial distress, emphasizing the availability of structured payment plans tailored to individual cash flows. This proactive approach aims to alleviate the burden on taxpayers and encourage compliance.
He added, “We encourage tax agents to talk to your taxpayers about the new letters. They need to take notice of the requirements in the letters and take action accordingly.”
Commissioner General Sam Koim, underlined this commitment, highlighting the significant role of the new letters in facilitating easier understanding of tax obligations.
IRC DCOD Director, Mrs. Kaia Fabila, delivering the keynote speech, reiterated the overarching objective of the project to foster voluntary compliance through enhanced clarity and transparency.
She emphasized that while the content of the letters remains consistent with previous versions, the redesigned format aims to improve readability and comprehension.
The project's success owes much to the collaborative efforts of internal and external stakeholders, including feedback from tax agents.
“There has been a lot involved in this project to get to where we are today. The entire debt and lodgment suite of letters has been reviewed and rewritten. There has been internal and external stakeholder management, and thank you to the tax agents in the room who have provided feedback.” Ms. Fabila reiterated.
Moreover, the incorporation of plain English and an active voice, coupled with color-coded themes for different types of correspondence, further enhances the user experience and have a much better use of formatting and space, all leading to greater taxpayer and tax agent understanding of their obligation.
Colour coding themes corresponds as follows:
- Green themed letters for general or positive correspondence
- Orange themed letters for early collections correspondence
- Red themed letters for firmer action correspondence
“I am excited to see the impact that these new, improved debt and lodgement letters will have on our organization and our wider community,” she added.
A significant aspect of the overhaul is the reduction in the number of templates, from 54 debts and lodgement templates to approximately 33 templates, achieved through the implementation of variable-based templates. This streamlining not only simplifies the process for taxpayers but also enhances efficiency for IRC staff.
The launch ceremony culminated in the unveiling of the new letters, symbolizing a significant milestone in the IRC's journey towards modernization and efficiency. With the renewed collaboration between IRC and ATO, as underscored by a recent memorandum of understanding, stakeholders can look forward to further advancements in taxpayer services.
As the IRC embraces its new look and branding, marked by user-centric communication and streamlined processes, it reaffirms its commitment to becoming a robust and efficient tax administration. The launch of the new debt allotment letters indicates a new era of clarity, transparency, and cooperation in tax compliance.
