Senate calls for further crackdown on tax schemes
A Senate committee has called for a renewed crackdown on the promoters of mass marketed tax effective schemes in the latest installment in the long running battle between the Australian Tax Office (ATO) and those promoting aggressive tax minimisation strategies.
The Senate Economics Reference Committee, in a report released yesterday, urged the tax office to drop all penalty and interest payments for individual participants caught up in the mass marketed tax schemes scandal, in exchange for participants forgoing the right to further objections and appeals against the ATO.
But the committee recommended tough new measures aimed at those responsible for running and marketing tax effective schemes, including the establishment of a special task force to investigate and prosecute promoters of such schemes.
The task force would be backed by specialist resources, and possibly legal provisions, allowing it to circumvent current secrecy and privacy laws that have limited current investigations into tax effective schemes.
“The Committee considers that it is crucial that any concessions for investors be matched by tough measures to deter and penalise promoters of aggressive tax planning arrangements,” a statement released by the committee says.
The tax office currently has 115 scheme promoters or advisors under investigation in relation to agribusiness, franchise and research schemes, and others under investigation in relation to film, book, investment and live theatre schemes.
The tax commissioner Michael Carmody, who has been roundly criticised for taking up to four years to disallow some of the schemes, welcomed the report yesterday, but was prepared to say only that the tax office would examine the committee’s recommendations.
The tax schemes, some of which had been around for more than ten years before the tax office made an adverse ruling against them, involve over 60,000 people, many of whom have now been left with tax bills and penalties running into the tens of thousands of dollars.
AUTHOR
George Liondis
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