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Wednesday, 14 September 1983
Page: 858

Question No. 124


Dr Klugman asked the Minister for Finance, upon notice, on 11 May 1983:

(1) How many relevant sales tax assessments have been issued by the Australian Taxation Office since allegations of widespread motor vehicle sales tax avoidance or evasion were made in the New South Wales Legislative Assembly by Mr M. R. Egan, M.P., on 23 and 28 September 1982.

(2) What are the amounts of each of these assessments and to what periods do they relate.

(3) What action is being taken to prevent companies involved being stripped of assets and to ensure payment of the assessed amounts.

(4) In view of the comments by the Taxation Commissioner, Mr O'Reilly, that schemes referred to by Mr Egan were ineffective evasion schemes, what action has or is being taken to prosecute those involved.


Mr Keating —The answer to the honourable member's question is as follows:

(1) and (2) The Commissioner of Taxation has advised that since 23 September 1982, notices of assessment have issued to a further 21 wholesale companies involved in motor vehicle sales tax schemes.

He supplied the following assessment details.

Period of

Sales tax

assessment

assessed Penalty

$ $ 1

1.2.1981-31.5.1982 1,366,543 1,366,543 2

1.4.1980-30.9.1982 4,107,292 4,107,292 3

1.9.1980-31.3.1982 552,844 552,844 4

1.2.1981-30.4.1982 146,297 146,297 5

1.5.1982-16.9.1982 88,520 88,520 6

1.5.1980-30.11.1980 82,892 82,892 7

1.5.1982-25.5.1982 75,797 75,797 8

10.7.1979-7.11.1980 526,223 526,223 9

1.12.1981-15.9.1982 499,639 499,639 10

1.10.1979-31.12.1981 347,780 347,780 11

1.10.1979-31.5.1981 353,711 353,711 12

1.6.1980-30.11.1980 59,192 59,192 13

1.1.1981-31.3.1982 575,651 575,651 14

16.6.1980-4.12.1980 664,945 664,945 15

1.5.1979-31.12.1979 2,908,753 2,908,753 16

9.8.1979-24.9.1982 2,557,345 2,557,345 17

1.9.1979-30.9.1982 2,692,069 2,692,069 18

1.7.1980-30.9.1982 1,074,700 1,074,700 19

1.10.1979-30.11.1980 317,175 317,175 20

5.6.1980-20.7.1981 222,762 222,762 21

1.1.1982-28.1.1983 316,515 . .

19,536,645 19,220,130

The Commissioner has also explained that, in addition to these assessments, assessments have issued in 13 cases to the retail company associated with the wholesaler.

(3) In broad terms, the Crimes (Taxation Offences) Act 1980, which came into operation on 4 December 1980, makes it a criminal offence for a person to enter into, or to aid or abet another person to enter into, any arrangement or transaction for the purpose of rendering a company unable to pay sales tax due or to become due. The penalty for an offence is imprisonment for up to five years or a fine of up to $50,000 or both.

The Commissioner will be pursuing all avenues available to him to recover the tax assessed in scheme cases. Amongst other things, the sales tax law empowers the Commissioner (by notice in writing) to require payments to him by persons owing money to, or holding money on account of, a taxpayer. The Commissioner has served such notices on debtors (including banks) of numerous taxpayers who have participated in sales tax schemes.

(4) The Commissioner confirmed that he does not concede that the schemes are effective under the existing sales tax legislation. Prosecution proceedings have already commenced against several persons implicated in sales tax schemes and other possible prosecution cases are presently under consideration.