Why Swan moved the nation’s top tax man on

Michael D’Ascenzo is out as the Australian Taxation Office chief. It’s worth examining his departure and legacy.

Treasurer Wayne Swan announced on Wednesday the tax commissioner would leave at the end of the year, completing his seven-year term before commencing a five-year term as a non?executive member of the Foreign Investment Review Board in a part-time position. A commissioner is eligible for re-appointment by the government after each term in accordance with law?—?Swan chose not to.

One thing D’Ascenzo will substantially notice when he shifts over to the FIRB is the money. The tax commissioner’s job pays around $630,000 while a non?executive member of the FIRB receives around $47,000 annually. Go figure. It is even more ironic given D’Ascenzo lobbied hard for the Remuneration Tribunal last year to increase his tax chief salary by 58%. He was successful and his salary would have risen to $740,000 by 2014.

It is interesting to compare how governments have treated his two predecessors, Trevor Boucher and Michael Carmody. Boucher retired in January 1993 and spent two years as Australian ambassador to the OECD in Paris while Carmody was parachuted into the Australian Customs and Border Protection Service in 2005 after a 12-year stint as commissioner. Given D’Ascenzo’s 35 years’ experience where he interacted with key players in government, the legal and accounting professions and the community you would think Swan could better utilise his expertise rather than giving him a part-time job at the FIRB.

The D’Ascenzo reign has had its ups and downs. Just last Friday he was awarded the Chartered Accountants Leadership in government, “Outstanding Contribution to Public Administration Award”. In 2010 he was appointed an Officer of the Order of Australia (AO) for service to public administration, particularly through reform and innovative engagement with the taxation profession and other government agencies. In November 2010 he was awarded the International Tax Review Editor’s Choice award for contribution to taxation in the Asian region.

But D’Ascenzo has also had his detractors. It began in his first year in the job when he locked horns with the government’s inaugural taxation inspector-general David Vos. Vos gained a reputation as a tax office watchdog and a tenacious taxpayer advocate often publicly criticising excessive ATO actions. D’Ascenzo reacted by obtaining legal advice on either issues identified in a review or on the scope of Vos’ powers to obtain information. At this early stage many in the tax industry felt D’Acenzo’s push to make the ATO more transparent was just all talk. D’Ascenzo was backed by then treasurer Peter Costello and in 2008 Vos was not re-appointed to his watchdog role by Swan.

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