ATO Releases Promoter Penalty Practice Statements

by Mary Swire, for LawAndTax-News.com, Hong Kong

23 April 2008

Australian Tax Commissioner Michael D’Ascenzo on Thursday released two practice statements outlining the principles that the Tax Office will follow in applying promoter penalty laws.

Speaking to the National Institute of Accountants, Mr D’Ascenzo explained that the Tax Office has spent time consulting with the community to finalise the practice statements.

“Tax exploitation schemes are a constant challenge to the fairness of the tax system. In the past, taxpayers involved in such schemes were penalised but promoters were not. The new laws help to level the playing field,” Mr D’Ascenzo stated.

“The practice statements provide guidance to Tax Office staff on the decision-making process for applying sanctions under the law to deter the promotion of tax exploitation schemes. They also address the concerns of tax professionals about the impact the laws may have on their ability to give professional advice," he added, going on to conclude:

“Often the ‘brains’ of these schemes are offshore and depend on local firms with a client base to distribute the exploitative product. My advice to firms is don’t get caught up in these schemes and bring such matters to our attention early.”

Recommended