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Tax avoidance claims must be fully investigated



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Peter Reith

DEPUTY LEADER of the OPPOSITION PRESS RELEASE SHADOW TREASURER

TAX AVOIDANCE CLAIMS MUST BE FULLY INVESTIGATEDĀ·

The Hawke Government should immediately give federal terms of reference to the W.A. Inc Royal Commission to ensure that claims that the ALP avoided paying tax on investment income from political donations will be fully investigated.

Federal terms of reference would enable the Royal Commission to explore the WA corruption issue, and the issue of tax avoidance concurrently.

The evidence presented to the WA Inc Royal Commission by Mr Burke's former personal Secretary, Mrs Brenda Brush, raise serious questions that MUST be answered.

The Royal Commission has been told Brian Burke controlled millions of dollars in political donations in a personal saving account and that substantial sums of money from that account were placed in income-earning investments.

Under oath before the Royal Commission, Mrs Brush said that this money then made its way into ALP coffers, but that the ALP was NOT told the money included taxable income from investments.

Mrs Brush told the Commission, however, she had discussed the tax issue with Brian Burke, and perhaps the then WA State Secretary of the ALP, Michael Beahan.

The most basic questions have not been answered: did the ALP declare the income from the Burke investments and fulfill its obligations to the tax office?

Did Brian Burke pay tax on the income from the investments he made?

These are extremely serious questions.

The amounts of money involved are substantial.

Obviously, the WA Inc Royal Commission has the specific task of investigating possible corruption in state Government business activities, and in completing that task the tax avoidance issue may not be fully explored.

The Federal government should, therefore, approach the West Australian Government and seek its agreement to confer federal terms of reference to ensure the issue of tax avoidance is fully investigated.

This is a matter of priority.

When I raised the issue of possible tax avoidance yesterday morning, I had no idea the Commission would jump onto the tax side of things as quickly as it has.

Even in the first evidence that's been presented on the taxation issue serious questions have been raised.

COMMONWEALTH PARLIAMENTARY LIBRARY MICAH

2

The Treasurer should assure the people of Australia that these claims of tax avoidance will be fully inquired into by the Tax Office.

One would expect such claims would be automatically explored by the Tax Office, but since the claims revolve around possible avoidance by the ALP itself, the onus is on Mr Keating to assure ordinary PAYE taxpayers there's no way the claims will be "swept under the carpet" or forgotten.

Justice not only has to be done, it has to appear to be done.

An open, independent inquiry is the best means by which these tax avoidance claims can be explored.

The public would have a right to be sceptical about anything less.

MELBOURNE

2 MAY 1991

CONTACT: DAVID TURNBULL, 06 277 4277

D57/91