Former ATO auditor Chris Seage writes:
Evidence provided to the Cole Inquiry has alleged that $300m in facilitation payments was paid by AWB, and more by BHP Billiton. You’d think the ATO would be eager to get its snout in – but it has shown no interest in conducting a major audit into the scandal.
Greens Senator Bob Brown finally got this reply from the Treasurer last week after he asked him several questions in January relating to what the government was doing in cracking down on tax breaks for facilitation payments, and what are the costs to taxpayers of providing tax deductibility for “facilitation” payments:
The Commissioner of Taxation advises that the Australian Taxation Office (ATO) has no data on facilitation payments made by Australian companies.
When introducing the legislation into Parliament in 2000 to disallow a deduction for bribes made to foreign public officials, Mr Costello said in the explanatory memorandum:
“As the ATO does not collect data on bribery payments, it is not possible to quantify the impact on revenue. However, the Government considers that Australian businesses are not significantly involved in bribing foreign public officials. Accordingly, any increase in revenue resulting from this measure should be minimal”.
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So has ink anything has changed since the AWB scandal? Have a look at this exchange in the May Parliamentary Committee meeting:
Senator SHERRY—I am not asking for the names, but are there any companies that are currently facing a check in respect to bribery? Are there any companies currently being checked by the tax office for claiming tax deductibility on facilitation payments?
Mr D’Ascenzo—I do not know. I cannot specifically say yes or no on that.
Senator SHERRY—I am not going to ask for the names, I am aware of that. Why can you not indicate?
Mr D’Ascenzo—I just do not know the nature of all our investigations.
Senator SHERRY—Is Mr Konza aware?
Mr Konza—I am not aware of any specific cases either.
In May Commissioner Michael D’Ascenzo and other senior officers told the Economics Legislation Committee that the extent of their activity was limited to developing a booklet for large businesses and cursory questions by auditors if they happen to be auditing a company which does business in a listed country where it is known corrupt payments exist.
A study released by the Centre for Australian Ethical Research has revealed that only half the companies in the S&P/ASX 100 have policies prohibiting the giving and receiving of bribes. In Britain, 92% of the top companies have rules that ban bribes. In Europe, the figure is 91% and in the US, 80%. If the AWB bribe scandal didn’t raise alarm bells in the ATO, then surely this research did.
It’s time for the tame tabbies of tax probing in Canberra to get strong and do the job we are paying them to do: protecting the revenue.
My advice to Mr D’Ascenzo is to get a hundred of his best company auditors and have them pore 24/7 over the tax returns of any company doing business in a listed country where bribes are the norm – then start asking the hard questions.