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Tuesday, 28 October 2014
Page: 12356

Fuel Tax Credit Fraud

(Question No. 225)

Mr Kelvin Thomson asked the Treasurer, in writing, on 14 July 2014:

In respect of a recent media report 'Hells Angels' trucking companies ripping off millions in fuel rebates' by Noel Towell ( The Age , 4 July 2014), (a) is he aware of this report, (b) what action is the Australian Taxation Office (ATO) taking to recover money paid for fictitious road haulage, (c) has the ATO referred, or does it intend to refer, evidence obtained on this issue to the Director of Public Prosecutions for consideration, and (d) what is the Government doing to ensure that diesel fuel rebate claims are legitimate.

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

I am aware of the report.

The ATO continues to work closely with other agencies in the fight against organised crime and fraud and is a member of a variety of taskforces that include the National Anti-Gangs Taskforce.

There have been some allegations made in the media recently in relation to bikie gangs involved in fraudulent activity in the transport industry.

While there are about 250,000 registered claimants for fuel tax credits claiming between $5 to $6 billion per year, a small percentage of these do the wrong thing. In 2013-14 the ATO completed in excess of 2,200 fuel tax credit related compliance activities, with total fuel tax credit adjustments (including penalties) of approximately $21.4 million. Around 600 of these activities (with adjustments and penalties of $6.4 million) related to claimants in the road transport industry. Less than 1 per cent of the compliance activities during a year result in matters referred for potential suspected fraud.

There are two matters before the Courts currently being prosecuted by the Commonwealth Director of Public Prosecutions (CDPP) involving fuel tax credit fraud by members of the transport industry. It is inappropriate to comment on the details of any specific matters underway.

During 2013-14, the ATO, with the support of the CDPP, was successful in securing two prosecutions relating to Energy Grants Credit Scheme (EGCS) and the Fuel Tax Credit scheme (FTCs):

On 4 September 2013 - A Victorian loan broker was jailed for 6 years and 6 month for a $1.3 million fraud.

On 29 November 2013 - A Queensland registered tax agent who falsely claimed fuel tax credits and GST input tax credits was sentenced to be of good behaviour for the next three years with a reparation order for $12,235 (the amount defrauded).

The Government stands by the ATO's efforts to maintain the integrity of the fuel tax credit regime. In fairness to the majority of people who meet their obligations, the ATO conducts activities to verify compliance, identify possible incorrect claims and fraudulent activity. This includes investigating any possible abuses of the EGCS and FTCs across all industries including road transport.