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Real property transactions data matching program exemption

Our reference: DMA17/00002

[redacted]
Gatekeeper Team
Data Science and Special Purpose Acquisition
Smarter Data Program
Australian Taxation Office

By email: [redacted]

Dear [redacted]

Real Property Transactions – 20 September 1985 to 30 June 2017 data matching program protocol

I refer to your correspondence of 29 May 2017 regarding the Australian Taxation Office’s (ATO) Real Property Transactions—20 September 1985 to 30 June 2017 data matching program protocol.

I understand that during this data matching program, the ATO will use property transaction data from the state and territory revenue and land title authorities to assist taxpayers in meeting their capital gains tax (CGT) and other taxation obligations.

The ATO’s correspondence requests an exemption to the data destruction timeframes contained in Guideline 7 of the Guidelines on Data Matching in Australian Government Administration 2014 (the Guidelines). Specifically, the ATO is seeking to retain data for seven years from receipt of all the data files from the source entities, with a review to be conducted prior to the end of this seven year period to determine whether an extension to this timeframe is required. I note that the ATO currently anticipates that it will need to retain this data until all properties in the data set have been transferred to the new mandatory reporting regime in place with state and territory land and title offices.

The ATO considers that an exemption from the usual data destruction timeframes is necessary because compliance with the data destruction timeframes would inhibit its ability to identify taxpayers who may be subject to administrative action. This could negatively impact both public revenue and public confidence in the administration of the taxation system.

Consideration of issues under Guideline 10

Under Guideline 10, in seeking an exemption an agency must:

  • advise the Commissioner in writing of the details of the proposed data matching program
  • in that advice, specify how the proposed data matching program would be inconsistent with the guidelines
  • explain the public interest grounds that justify the inconsistency.

In my view, your correspondence satisfies these requirements. This includes explaining the public interest grounds for the exemption in the program protocol, such as that:

  • the ATO is responsible for the administration of the CGT regime
  • the Government enacted legislation for mandatory reporting of property transactions to the ATO commencing 1 July 2016, however the historical data captured under this data matching program is required on an ongoing basis for cost base and capital proceeds calculations when a real property asset is disposed of
  • the real property transfer data enhances the ATO’s analytics capability and assists individuals to comply with their taxation obligations through prefilling alert services.

Exemption approval

I have considered the information provided by the ATO and agree that, from a privacy perspective, it would be appropriate for data destruction requirements in Guideline 7 not to be followed for a period of seven years. In my opinion, compliance with these requirements could significantly reduce the effectiveness of the ATO’s data matching program and consequently may negatively impact the public revenue and public confidence in the administration of the taxation system.

I approve the ATO’s request to retain information collected during the data matching program for a period longer than 90 days. I have agreed to this exemption on the understanding that the information will not be retained beyond seven years from the receipt of all data files from the source entity, unless a further exemption is approved.

This exemption is only applicable to the data collected for the Real Property Transactions—20 September 1985 to 30 June 2017 data matching program.

Publication on the OAIC website

Under Guideline 10.6, it is the OAIC’s normal practice to make exemption requests publicly available. The ATO has advised it does not request that this advice be kept confidential and, as such, I will make it publicly available on the OAIC website.

Yours sincerely

Timothy Pilgrim PSM
Australian Information Commissioner
Australian Privacy Commissioner

5 July 2017