The Partnership Model of the Relationship between Tax Administrators and Tax Practitioners: Drivers, Challenges and Prospects

Drawing upon the theory of responsive regulation, in the 1990’s the Australian Commissioner of Taxation expressed the partnership model of tax administration. Shortly afterwards, the New Zealand Inland Revenue Commissioner joined this shift, to what has been caste as, the way forward in meeting the demands upon a tax administration in a modern, open democratic society. After something like a decade since the adoption of this new model of tax administration, it is appropriate to review its history, the challenges that have been encountered and also to reflect upon the prospects of the partnership model. The purpose of this paper is to undertake this task and to suggest avenues for further critical reflection upon the operation of the partnership model with a view to its enhancement.The first part of this paper identifies and elaborates upon the two models of tax administration that are evident in the recent Australian and New Zealand history – the adversarial model and the partnership model. The second part of the paper reviews the drivers which prompted the paradigm shift in New Zealand and Australia from an adversarial model to a partnership model. The third part of the paper identifies tensions within the partnership model and discusses the practical emanations of these tensions, evident in the operation of the partnership model.