Why cyber security keeps Jordan awake at night
After a decade of rapid change at the ATO, the Commissioner recommits to a digital vision but admits there are challenges.
Cyber security is the one issue that keeps Commissioner Chris Jordan awake at night with the equivalent of 1 billion filing cabinets of personal data behind the ATO’s digital defences, he admitted to the IPA annual conference yesterday.
He said the ATO had repelled almost 18 million cyber attacks in the past six months and would face increasing rates of attempted fraud using ever more sophisticated techniques.
However, in possibly his final speech before leaving at the end of next February, Mr Jordan said the ATO remained committed to being fully digitised by the end of the decade and its vision for a future where “tax just happens”.
“We know the future of tax is digital and data driven,” he said. “And while this creates many opportunities, we’re conscious of the challenges that accompany our digital landscape.
“I have been asked several times over the last year, ‘What keeps me up at night?’ My response has always been: cyber security.
“The ATO holds about 50 petabytes of data. This is equivalent to 1 billion tall filing cabinets. In the past six months we’ve defended almost 18 million attempted cyber attacks.
“We are entrusted with protecting the community’s personal information and this trust underpins our tax systems. We must correctly balance opportunities from the digital revolution with system integrity.”
Increased cyber threats had gone hand in hand with a “significant increase in the pace, scale and size of attempted fraud” and were behind recent moves such as the revised client-agent linking system.
“Those attempting fraud against honest Australians are opportunistic. They continually test systems across the community to refine their expertise and find new ways to breach defences. These criminals don’t care who they target – the ATO, tax agents or small business – anyone and everyone is fair game.
“Our risk of sophisticated fraud attempts will continue to grow with global threats, organised crime, the use of artificial intelligence and data breaches in the community.”
Mr Jordan said he had been surprised by the speed of change at the ATO during his term but its vision for a seamless digital future – in line with the OECD’s so-called Tax 3.0 – was still a work in progress and there was no intention to design tax professionals “out of the system”.
“Firstly, change isn’t happening just because we want it to,” he said. “The world is changing, along with our tax and digital ecosystems and client expectations. It is important our organisational goals continue to evolve and keep pace.”
“Secondly, we don’t know exactly what the future state for Tax 3.0 will look like. We’ve shared the possibility of a BAS-free future. This is us embracing one of the four principles in our digital strategy: ‘to imagine the possible’. In other words, to reimagine our systems and harness data to achieve a periodic data feed direct from small businesses’ natural systems to the ATO.
“Thirdly, what we do know is that to achieve the best outcome, we need to collaborate and co-design with our partners in the system, and that’s what we are doing. We’re working with digital service providers, the tax and BAS agent community and other key players to bring Tax 3.0 to life. The insights of the tax profession are essential in helping get the right outcome.”
Mr Jordan said he had taken on the Commissioner’s role determined to change the ATO’s reputation for being difficult and the office was now “committed to making it easy to engage with us”.
“Reflecting on the last decade, I have witnessed an astonishing pace of change and innovation within the organisation. I’ve seen the ATO successfully adapt and evolve to meet the many challenges and opportunities.
“Ten years ago, the profession told me how difficult the ATO was. I now hear stories about the relative ease of interacting with us and their trust and confidence in our professionalism and fairness.”
“I am confident that with the existing strong foundations, the ATO will continue to deliver as a world-class tax and super administrator into the future.
“Together, as stewards of Australia’s tax system, let’s rise to the challenge to ensure it is fair, future-focused and sustainably strong to support Australians for the future – long after we’ve all retired.”
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