Former Tax Office auditor Chris Seage writes:



A few weeks ago (12 May, item 14), I wrote about the Howard government’s penchant for chasing small time
welfare fraud at the expense of netting the big whales in the tax fraud pond.
In yesterday’s Daily Telegraph,
Labor’s human services spokesman Kelvin Thomson said that a report he commissioned
reveals every dollar spent on catching tax cheats brings in $7.53 while the
Government will recover just $1.94 per dollar spent on welfare fraud.
Last
year the DPP prosecuted 4,102 welfare cheats out of 6.5 million welfare
recipients as opposed to 249 tax cheats out of 15 million taxpayers.

When this latest
report is put with the figures I provided to readers on the cost of fraud to the government
that the AFP had investigated or had referred for investigation, that adds up to 376 cases from
the ATO totalling $42M in the cost of fraud. Conversely, Centrelink had 26,118
cases for a lower reported cost of fraud of $41M. You don’t have to be a
mathematician to work out where the money is or does the Howard government
believe welfare fraud is more serious than tax fraud? Perhaps this explains how the Gerard
Industries matter was allowed to slip through the system.

On these figures Tax
Commissioner Michael D’Ascenzo should be knocking down Peter Costello’s door
bellowing for more resources. And why hasn’t Costello said anything about the
huge disparity between Centrelink and ATO resourcing? Perhaps he still has his
eye off the ball.

Peter Fray

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