Tax office debt collection tops complaints

The tax watchdog says the debt collection practices of the Australian Taxation Office remain a concern, making up almost a quarter of the complaints it receives.

The Inspector-General of Taxation's annual report released on Friday showed complaints were up seven per cent to 2405 in 2017/18.

Debt collection action by the ATO - including payment arrangements and garnishing amounts from taxpayers' accounts - represented 24 per cent of complaints, followed by lodgement and processing issues, delayed payments and audit/review activities.

The inspector-general said its review of the ATO's use of garnishee notices, which followed a Fairfax-Four Corners investigation, was still in progress.

The investigation is looking at claims by former and current ATO staff about the inappropriate use of ATO powers to issue garnishee notices and extract payments from small business operators.