Sitting on the bench : an exploratory study into Inland Revenue's industry benchmarking programme.
Degree GrantorUniversity of Canterbury
Degree NameMaster of Commerce
The Inland Revenue Department (Inland Revenue) launched the Industry Benchmarking Programme (Benchmarking Programme) in 2011; which closely followed the Small Business Benchmarking Programme (SBBP) which was released by the Australian Taxation Office (ATO) in 2009. These programmes took data from tax returns and other sources, and turn this into a series of financial benchmarks for specific industries. The data from these programmes was then published on the respective websites of Inland Revenue and the ATO. It was envisaged by both tax administrations that this data would be used by taxpayers to benchmark their financial performance against others in their industry. The Benchmarking Programme was designed to assist Inland Revenue with its compliance strategy and to better its their audits.
This exploratory research was mainly focused on the use (or lack of) of Inland Revenue’s Benchmarking Programme by taxpayers and tax practitioners. Other aspects of the Benchmarking Programme were investigated. Interviews with six tax practitioners were conducted, supplemented by documentary analysis of the Benchmarking Programme and other sources of data. It was found that the tax practitioners do not use the data for several reasons, including issues with the integrity of the data and its usefulness. It suggested that taxpayers do not use the data from the Benchmarking Programme, and indeed may not have any knowledge of it. The overall impact of the Benchmarking Programme was deemed to be minimal. Several recommendations were to be presented for consideration by Inland Revenue as a result of the findings in the project.