The head of the Australian Taxation Office has declared ‘integrity is everything’ after the organisation was cleared of allegations it had executed a widespread cash grab on small businesses.

ATO Commissioner Chris Jordan has expressed the sentiment in an address to the Tax Institute’s national convention in Hobart, after noting media commentary that 2019 may well be the ‘year of the watchdog’.

‘A healthy tax system which people have confidence in contributes to the stability and prosperity of our country,’ he said on Thursday.

‘With a federal integrity and corruption commission on the cards – integrity is everything.”

Mr Jordan’s speech comes after Inspector General of Taxation Andrew McLoughlin on Wednesday released the findings of his review into allegations the ATO inappropriately used garnishee notices in 2016/17.

The notices are used to recover tax debts through third parties, such as banks or customers who owe the business money.

ABC’s Four Corners alleged in April 2018 the ATO had told staff to issue standard garnishee notices in every small business case as a ‘cash grab’ towards the end of the year.

The ATO was also accused of assessing the performance of staff based on how much debt they collected.

After an extensive probe, Mr McLoughlin cleared the ATO of widespread issues.

‘The allegations that there was an ATO direction for a ‘cash grab’ on small business or that debt staff personal performance were set on amounts collected – are not sustained,’ he said.

But he said problems did arise in some local areas for limited periods, particularly at the Adelaide office, by way of the inappropriate use of ‘enduring’ garnishee notices.

Such notices require recurring payments for a certain period of time, generally three months.

‘Those problems were anticipated and addressed by management once they became aware,’ Mr McLoughlin said.

Mr Jordan has welcomed the report and lamented that much of the media commentary about his organisation in 2018 was ‘disappointing’.

‘While we have done much to build trust and confidence in the system and in us … some media was doing the opposite,’ he said.

He’s feeling more optimistic about the future and the ATO’s work with small businesses.

Small Business and Family Enterprise Ombudsman Kate Carnell says the high number of garnishee notices issued in 2016/17 is still concerning.

The review found there were 23,712 notices issued in the year, about 40 per cent less than the 40,289 notices the ATO had expected to send.

‘Given the draconian nature of the notices and the lack of judicial or other external oversight of notices before release, they should be used only as a last resort … if at all,’ Ms Carnell said.