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Garnishee notices aren’t ‘the appropriate action for the ATO to take’, says Ombudsman

The small business Ombudsman says the use of garnishee notices by the Australian Taxation Office is a concern, despite a review by the inspector-general of tax.

A joint Fairfax-ABC investigation alleged the ATO was taking harsh actions against small businesses, by using performance indicators to incentivise the issuing of garnishee notices.

Inspector-general of tax Andrew McLoughlin’s review into these allegations found no evidence of this.

Garnishee notices are when the ATO takes money out of a business’ bank account to collect outstanding debt.

Australian Small Business and Family Enterprise Ombudsman Kate Carnell tells Ross Greenwood “they can put you out of business with an order and that’s our concern.”

“The dilemma we’ve got with this is that we see situations where the ATO may not have been in touch quite as often as they should of.

“But the decision, to what is close down the business in many circumstances, isn’t the appropriate action for the ATO to take.

“I’m fascinated that the ATO can do this without any oversight, by say a court order.”

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