Talking to ZDNet Australia about the ATO's progress in release two of its AU$400-$450 million Change Program, Farr said his staff were on track to deploy the case management system to up to 15,000 users by early December.
With 7,600 call centre operator and tax auditor users currently, the new case management system replaces 180 systems that "didn't talk to each other", according to Farr. It benefits tax auditors, especially those out of the office, by providing a complete view of a taxpayer's history with the ATO.
"This week we're rolling it out to another 700 staff," said Farr.
"I was talking with someone from Siebel-Oracle recently and we said we're basically doing a normal Siebel implementation per week.
"So we are on track for full deployment by early December."
Also recently completed was version 10 of the ATO portal for business and tax agents, which introduced secure messaging.
The ATO also began scanning all mail to the organisation at its document processing centres in Penrith and Albury in New South Wales. All scanned documentation is fed into the case management system, and can be "workflowed" to the respective employee.
"We've positioned ourselves pretty well for our push into release three. We've now been going 18 months, and we've got 18 months to go."
Release three requires the ATO to replace its legacy mainframe systems, including income tax, fringe benefits and business activity statements, by December 2007.
Farr's staff recently completed the design and build of the operating system for fringe benefits tax, which they were now running, he said.
"We hope to finish all the [system] builds by December this year to give us a full year of testing.
"To move all our systems across in one go would be pretty nervous."
While on track, Farr said the ATO were running to a strict schedule.
"It is pretty tight, I'd have to say."
Still Farr was confident the ATO's systems could stand up to their demands.
He said the ATO's mainframes on Monday set a new benchmark after they processed one million transactions in a day.
"The robustness we've been able to build into the program is quite amazing.
"It's been mainly about technical infrastructure design and adding capacity."
A potential problem looming however is the government's sweeping changes to superannuation tax and contributions, announced in May's federal budget.
Farr said he expected implementing new systems for the changes to be "a really major task for us".
This would be due around the same time as the ATO was scheduled to go live with its new mainframe and processing systems.
"The build would need to be done in parallel," said Farr.
However he had not received any design plans from government yet.
"We would expect a finalised design in this calendar year, and then start to implement sometime in 2008."
While the ATO's decision had not changed on using workers offshore, Farr said the problem of skills, particularly in enterprise application integration, was an ongoing issue for the ATO.
"The other thing that is a concern for me is the scarcity of resources in the Australian IT landscape at the moment.
"I can't imagine we're the only ones suffering from it.
"Some of the people we've lost have been offered twice or triple the salaries we've been able to offer them," he said.
In this regard, developers skilled in .NET have been difficult to find, according to Farr.