The tax man is stepping up the war on fraud and dodgy claims, using the Australian Crime Commission to monitor suspected cheats. Tax consultant and former ATO manager Chris Seage reports it’s a first.
A note to paranoid tax cheats: they probably are following you. In an historic first, the Australian Crime Commission has entered into a $2 million two-year contract with the Australian Taxation Office to supplystatic and mobile surveillance to catch out tax cheats.
The new contract appears to have slipped through during the election period without any parliamentary scrutiny. And it comes as the United States Internal Revenue Service is under increased political scrutiny for conducting secret surveillance on Tea Party-aligned groups, searching and seizing citizens’ digital communications without a warrant and purchasing surveillance equipment — including coffee trays and plants with hidden cameras.
The new ATO surveillance team will be directed towards key focus areas of tax crime, according to statements from both the ATO and ACC. An ACC spokesperson told Crikey: “The ACC supports its partners in a number of ways. Under this specific contract, the ACC provides static and mobile surveillance skills and expertise to assist the ATO in addressing the highest tax crime priorities.”
The tax office has identified tax crime hotspots that can expect to be placed under the new surveillance arrangements — which it says cost Australia between $10-15 billion dollars every year:
Fraudulent “phoenix” activities: when a company goes into liquidation and leaves its debts behind while the assets are shifted into a new corporate entity that begins trading again, often under a similar name; and
Tax avoidance schemes: many arrangements involve the use of a trust or series of trusts to circumvent tax and super laws.
In declaring war on people who promote tax crime the ATO’s deputy commissioner of serious non-compliance, Greg Williams, said last month:
“Generally, you don’t just wake up in the morning and say, ‘you know what, I am going to restructure my business around a secrecy jurisdiction’ … someone is putting those ideas into people’s heads, and soon we’ll be tapping these people on the shoulder.”
ACC surveillance officers are drawn from current and former police officers and they must hold a current or recent qualification in operational safety and tactics, which includes the use of a firearm. In a recent advertisement for a physical surveillance officer it listed the key objectives for the position:
Operate specialised electronic equipment;
Monitor and record from electronic devices;
Capture, record and manage images and associated surveillance product;
Compile accurate and comprehensive accounts of surveillance activities; and
Attend legal proceedings and give evidence as required.
Prior to the election, Treasurer Joe Hockey said: “If elected a Coalition government will immediately establish a standing parliamentary committee with a singular focus: the oversight of tax administration.”