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Australian Attorney-General Gets Tough On Lawyers Who Avoid Tax

by Mary Swire, Tax-News.com, Hong Kong

27 July 2001

During a meeting convened earlier this week by the Standing Committee of Attorneys-General, it was agreed that all State and Territory laws regulating the legal profession will be strengthened as part of a strategy to clamp down on lawyers who declare themselves bankrupt in an attempt to avoid their tax obligations.

In a statement released by the Australian government, Attorney-General Daryl Williams explained that barristers who use bankruptcy to flout their tax obligations have the potential to undermine the integrity of, and damage public confidence in, the legal system. As officers of the court, they have a higher duty to avoid conduct that could damage the standing of the institutions that they serve.

The meeting concluded that each jurisdiction will consider amending its law so that:

  • lawyers are required to notify their professional association of events involving insolvency and of findings of guilt for indictable offences and tax offences
  • the disciplinary provisions that apply in relation to charges of 'professional misconduct' are strengthened. The definition of which would be amended to remove any doubt that conduct of a practitioner involving insolvency or conviction for an offence is professional misconduct if the conduct or conviction would justify a finding that the practitioner is not of good fame and character or is not a fit and proper person to remain on the roll of practitioners
  • the professional association is required to notify the Legal Ombudsman (or other equivalent body overseeing the legal profession), or the Attorney-General or both, of all cases falling within the new procedures, and of the decision made or action taken by the professional association

The government hopes the adoption of these measures will ensure that legal practitioners who become insolvent will be compelled to advise their professional association or face tough consequences, and that they will be assessed on whether they are a 'fit and proper person' to continue to practise.

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