Cross-government information-sharing to identity, stop or disrupt serious crime

Cross-government Information-sharing to identify, …
01 Nov 2012
pdf

Our Research and Evaluation Unit has released a study that explores the potential impact on the integrity of the tax system of sharing taxpayer information with other government departments to identify, stop, or disrupt serious crime.

Purpose

This study was designed to explore the following questions:

  • What information-sharing activities or practices do stakeholders in the tax system consider acceptable to identify and/or stop serious crime?
  • What types of information do stakeholders consider acceptable to share to identify and/or stop serious crime?
  • What impact would increased information-sharing have on stakeholders’ perceptions

Methodology

The research adopted a multi-method design, employing qualitative in-depth interviews and an online survey. The 48 interviewees were selected from the government, academic, tax and law, and general commercial sectors. The participants included chief executives, members of senior management teams, and senior academic staff. The 323 online survey respondents were from the same sectors as the interviewees, with the addition of the tax agent and intermediary sector.

Both the interview topic guide and the online survey incorporated four hypothetical information-sharing Scenarios, deliberately designed to test the boundaries of acceptability of Inland Revenue’s participation in cross-government information-sharing actions. They were not intended to accurately reflect current or potential information-sharing actions. The first Scenario involved Inland Revenue sharing information with Police after discovering a serious crime during an audit; the second involved Inland Revenue sharing taxpayer information with members of a taskforce; the third involved sharing a set of risk assessment scores with Police; and the final Scenario involved Inland Revenue supporting the Department of Internal Affairs with expertise and information. A full description of the methodology is available in Appendix A. This paper reports on the findings from both the interviews and the survey.

Key Results

Overall, Inland Revenue’s participation in information-sharing actions to address serious crime was found to be acceptable if it was fit for purpose. If Government proceeds down this path, the following concerns raised by participants should be considered. These include balancing the:

  • individual’s right to privacy with the benefits to society;
  • nature of the serious crime with the type and breadth of information requested;
  • authority of the information with the ability of the Department to supply it; and balancing the
  • intended and potential use of the information with the risk of error and its misuse.

It is clear from the interview and survey data that cross-government information-sharing to address serious crime is an all-of-government issue; it is not specific only to Inland Revenue. Further, legislation must underpin any fit for purpose information-sharing action and this should outline the permission, control, and transparency mechanisms the public requires.

Finally, tax secrecy does not appear to be a significant concern when considering Inland Revenue’s involvement in cross-government information-sharing to address serious crime. However, the potential impact on the public’s trust in Inland Revenue, and subsequent impact on the integrity of the tax system, needs to be considered. If Government communicates, on behalf of Inland Revenue, that specific taxpayer information will be shared under specific circumstances, both trust and integrity will be maintained in spite of selectively relaxing tax secrecy regulation to identify and stop serious crime.

Page last modified: 23 Apr 2018