Appendix 3: Legal services expenditure

Our total legal expenditure for 2015–16 increased by $7.5 million (or 9.3%) over the previous year, primarily due to the ATO’s increased debt recovery activity, as announced by the Commissioner in March 2015. Debt-related legal expenditure increased by $6.6 million, and legal action for creditor’s petitions and company wind-ups increased from 3,583 cases in 2015 to 4,801 cases in 2016.

TABLE 4.4 Legal services expenditure, 2015–16(a)(b)
 

$

Total costs recovered

9,517,854

   

Total external legal services expenditure (c)

59,630,895

Total internal legal services expenditure (d)

28,892,711

Total (external and internal) expenditure

88,523,607

Summary of external legal services expenditure

 
  • Total value of briefs to counsel

11,607,357

  • Total value of disbursements (excluding counsel)

24,454,893

  • Total value of professional fees paid

23,568,646

Total external legal services expenditure

59,630,895

Counsel (e)

 
  • Number of briefs to male counsel

628

  • Number of briefs to female counsel

252

Total number of briefs to counsel

880

  • Number of direct briefs to male counsel

322

  • Number of direct briefs to female counsel

116

Total number of direct briefs to counsel

438

  • Total value of briefs to male counsel (including direct briefs)

8,914,641

  • Total value of briefs to female counsel (including direct briefs)

2,692,716

Total value of briefs to counsel

11,607,357

  1. Includes Tax Practitioners Board (TPB) legal costs for 2015–16. Total external legal services expenditure for TPB: $221,066. Total internal legal services expenditure for TPB: $2,206,357.
  2. External expenditure reported above excludes GST.
  3. Excludes costs awarded against the ATO, external expenditure on compensation and legal costs attributable to the ATO’s test case program.
  4. ATO internal legal officers manage tax litigation (under Part IVC of the Taxation Administration Act 1953), debt litigation, general legal advice and freedom of information. This amount consists of the cost of labour and expenses for those activities. Some ATO employees perform functions that have some characteristics of legal work (for example, preparation of writs, statutory demands and bankruptcy notices) and provide interpretative advice on complex areas of tax and superannuation law. These activities are not undertaken by legal officers and, therefore, not included in this amount.
  5. ‘Direct’ briefs cover counsel briefed directly by the ATO and who work with our in-house litigators and/or business areas within the ATO. ‘Indirect’ briefs are counsel briefed by ATO’s external legal providers acting on behalf of the ATO.