Australia’s richest politician,
Malcolm Turnbull, might have been speaking from the heart when he
allegedly raised issues about the need to crack down on tax evasion.
But such a position will inevitably invite scrutiny of his own tax
arrangements and his involvement, if any, in tax planning on behalf of
previous clients, associates and employers.

After all, Trevor
Kennedy is a long time mate, and we know all about his Swiss tax
account – although Malcolm has apparently never gone down the foreign
bank account path.

Similarly, one of those recruited for the
Wentworth branch stack was none other than James Packer, and we all
know how many fights Australia’s richest family has had with the Tax
Office over the years. Indeed, Malcolm was the general counsel and
company secretary at Consolidated Press Holdings from 1983 to 1985, a
period in which CPH was controversially privatised for not much.

This
raises the question of whether Malcolm was himself involved in any of
Kerry Packer’s aggressive tax planning. He almost certainly would have
been involved in fighting some of the struggles that came out of the
Costigan Royal Commission as it was hurtling along in 1983-85. Costigan
did dig into Packer’s involvement with film schemes, but most of these
were put together in the late 1970s. Malcolm was never a tax lawyer, so
to fit him up with being the architect of any of those aggressive tax
schemes scrutinised by Costigan is certainly unfair.

Allen,
Allen & Hemsley was the legal firm which provided most of the tax
advice in the 1970s and early 1980s to Kerry Packer, and for the last
20 years the main Packer tax adviser has been Ernst & Young partner
John Cherry.

The other interesting element to this story is the way The SMH has handled it. Reporter John Garnaut has made the running and Malcolm is certainly not happy with him, posting this explanation on his website yesterday.

Garnaut kick-started the debate with this story on Monday. Rather than backing off, he followed up with this effort on Tuesday and another piece today.

Unfortunately for Garnaut, Laura Tingle provided some interesting background in today’s AFR when she wrote:

Two days after the party room meeting, Turnbull was interviewed by a journalist from The Sydney Morning Herald
in a taxi on the way to the airport and repeated what he has said in
the party room. Those comments surfaced three weeks later, on Monday,
with the added spin of saying the richest man in parliament wanted his
neighbours to pay more tax.

If Turnbull’s direct quotes were so explosive – read them
and you’ll see they are not – then why did Garnaut sit on the comments
for three weeks and wait to drop Malcolm in a pickle when Parliament
resumed? It’s not easy being a political tall poppy.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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