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Thursday, 29 May 2003
Page: 15553


Mr Murphy asked the Treasurer, upon notice, on 4 February 2003:

(1) Is he aware of the decision by His Honour Justice Sackville of the Federal Court in the matter of Prentice v Cummins (No. 5) (2002) FCA 1503 handed down on 5 December 2002.

(2) Is he also aware that, in the reasons for the judgment, Justice Sackville observed that (a) the bankrupt, Mr John Cummins QC, had not lodged any income tax return since about 1955, (b) this omission on the bankrupt's part occurred despite the fact that the bankrupt was admitted as a barrister of the Supreme Court of NSW on 28 April 1961 and was appointed one of Her Majesty's Counsel on 2 December 1980, (c) the Australian Taxation Office (ATO) seems to have done nothing about the bankrupt's failure to lodge income tax returns until the late 1990s and (d) the evidence does not address the reasons for the ATO's apparent inability to ascertain that a barrister, latterly a senior counsel, had apparently managed to carry on a professional practice for nearly 40 years without lodging an income tax return.

(3) Why was Mr Cummins only requested by the Taxation Commissioner to lodge income tax returns for the seven years ended 30 June 1992 to 30 June 1999.

(4) Is it the custom and practice of the Taxation Commissioner to only demand 4 to 7 years of outstanding returns regardless of how many years a person has failed to lodge an income tax return; if so, why.

(5) Why did the Taxation Commissioner give Mr Cummins a tax-free exemption of 38 years.

(6) What is the government doing to ensure that the Taxation Commissioner requires Mr Cummins to lodge income tax returns for the period 1955 to 1991.


Mr Costello (Treasurer) —The answer to the honourable member's question is as follows:

(1) to (6) The Commissioner advises me that it is inconsistent with his responsibilities under the secrecy provisions of the tax law to provide taxpayer details.

The Commissioner of Taxation is an independent statutory officer.

The Commissioner advises me that lodgment enforcement strategies are determined having regard to the overall risk as assessed. This ensures that highest risk categories are followed up where resources are not available to follow up all outstanding income tax returns.