Our recommendations

To control the growth of tax debt, Inland Revenue will need better information about the effectiveness and efficiency of its debt collection techniques. For this reason, these five recommendations involve Inland Revenue improving the information that it collects, uses, and reports.

We recommend that the Inland Revenue Department:

1. collect and analyse information about how many cases debt officers are managing, and how much of their work is inbound contact (where first contact is from a taxpayer contacting Inland Revenue) and how much is outbound (where Inland Revenue debt officers make first contact);
2. review how it selects the types of cases it does – and does not – allocate to debt officers, to ensure that it is:
   • taking reasonable steps to enforce taxpayers’ obligations; and
   • considering the potential effect on voluntary compliance if some types of cases are unlikely to be assigned to a debt officer;
3. include in its external reporting the total number of outstanding tax debt cases (by the age of tax debt) and the methods used to resolve tax debt cases;
4. improve the information used to monitor the effectiveness and efficiency of its tax debt collection work and to prepare its tax debt strategy; and
5. closely align its internal and external tax debt reporting.