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Telecoms Interception Powers Proposed For ATO

by Mary Swire,, Hong Kong

10 September 2015

Parliament's Joint Committee on Law Enforcement has recommended that the Australian Taxation Office should be permitted to access intercepted telecommunications information to tackle tax fraud.

The committee conducted an inquiry into the effectiveness of current law enforcement legislation and administrative arrangements that target serious and organized financial-related crime. According to the Australian Transactions Reports and Analysis Centre (AUSTRAC), serious and organized crimes costs Australia up to AUD15bn (USD10.6bn) a year.

In its report, the committee concluded: "On balance the committee is persuaded that, with appropriate safeguards, including adequate privacy and oversight arrangements, the ATO should be able to access intercepted telecommunications information for the purpose of protecting public finances from serious criminal activities such as major tax fraud."

"In the committee's view, the multiple prosecutions and recovery of billions of dollars in tax liabilities resulting from Project Wickenby clearly establishes the demonstrated need for the ATO to become a criminal law-enforcement agency under the Telecommunications (Interception and Access) Act."

The committee said that Project Wickenby was raised in submissions as "an example of an effective taskforce that drew together expertise and staff from different agencies, working collaboratively to achieve common goals." A multi-agency taskforce, Project Wickenby was set up in 2006 to protect the integrity of Australia's financial and regulatory systems. It concluded on July 1, 2015.

The taskforce prevented people from promoting or participating in the abusive use of what the ATO labels "secrecy havens." The ATO defines a "secrecy haven" as "a country, region, or state that does not divulge information about an individual's financial/banking affairs or structures." These jurisdictions do not have an effective information exchange agreement with Australia.

The ATO told the committee that Project Wickenby had been successful because it had recouped tax that had been avoided or evaded, reduced funds flowing to "secrecy jurisdictions," and successfully prosecuted promoters and facilitators of the abusive use of such jurisdictions. As at January 31, 2015, the taskforce had raised AUD2.16bn in liabilities and completed 4,848 audits. Charges have been laid against 76 individuals and 44 convictions obtained. The total amount of money recouped by the taskforce stood at AUD920.68m at January 31, 2015.

TAGS: individuals | compliance | tax | tax compliance | tax avoidance | government committee | law | banking | audit | Australia | enforcement | tax authority | agreements | legislation | telecoms | Tax | Tax Evasion

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