Dowsing and Commissioner of Taxation (Taxation)

This matter concerned an application for review of an objection decision made by the Commissioner of Taxation. The applicant, Mr Dowsing, sought the full remission of an administrative penalty imposed under the *Taxation Administration Act 1953* (Cth) for failing to lodge his tax return for the financial year ending 30 June 2017. The Commissioner had previously remitted 75% of the penalty, reducing it to 25% of the base amount. The Administrative Appeals Tribunal was asked to determine whether Mr Dowsing was liable for the penalty and whether the Tribunal should exercise its discretion to remit the penalty in full.

The Tribunal was required to determine two key issues. Firstly, whether Mr Dowsing was liable to an administrative penalty under s 284-75(3) of the *Taxation Administration Act 1953* (Cth) for failing to provide his tax return by the required date, which was necessary for the Commissioner to accurately determine his tax-related liability. Secondly, the Tribunal had to consider whether to exercise its discretion under s 298-20(1) of the *Taxation Administration Act 1953* (Cth) to remit 100% of the penalty. Crucially, the onus was on Mr Dowsing to prove that the penalty assessment was excessive or incorrect, pursuant to s 14ZZK(b) of the Act.

The Tribunal found that Mr Dowsing was indeed liable for the administrative penalty, as he had failed to lodge his tax return despite numerous attempts by the Commissioner to contact him and extensions negotiated by his tax agent. This failure meant the Commissioner had to make a default assessment. Regarding the remission of the penalty, the Tribunal considered the Commissioner's Practice Statement Law Administration 2014/4, which outlines principles for exercising discretion, including encouraging compliance and treating taxpayers honestly. While Mr Dowsing provided evidence of addiction issues with drugs and gambling, which he argued affected his ability to lodge his return, the Tribunal concluded that he had not discharged the onus under s 14ZZK(b) to prove that the circumstances were beyond his control to the extent required for full remission.

Consequently, the Tribunal affirmed the Commissioner's objection decision, meaning the penalty was not remitted in full.