ATO rebuked by tax watchdog for using debt collectors on people ‘doing the right thing’

The inspector general of taxation and ombudsman said people with tax debts were often already in financial distress. Photograph: Lukas Coch/AAP

The Australian Taxation Office must be considerate of a person’s circumstances, Australia’s inspector general of taxation has warned, after a spike in complaints over a third-party collector used to chase tax debts.

On Monday, Guardian Australia reported that the ATO had referred more than 355,000 taxpayers, including welfare recipients, to the private equity-backed debt collector Recoveriescorp since January 2024.