Speculation is mounting that the Australian Taxation Office are doing a secret settlement with former senator Graham Richardson over his $2.3 million dollar tax assessment. The Australian today alleges Richardson has not met a court deadline to file court documents and that could mean he is negotiating a settlement with the tax office.

What the hell is happening here? How could the ATO be negotiating with someone who they dealt a $1.6 million fine for taking “extraordinary steps” to hinder an investigation into his affairs? Last month I told Crikey readers the most serious allegation is that Richo lied under oath in a formal record of interview with ATO auditors on 17 March 2005 about his knowledge of $1,442,000 in a Swiss bank account.

As this matter allegedly involves indictable offences what does Commonwealth DPP Damien Bugg QC think about a secret ATO settlement? Shouldn’t he be jumping out of his tree to get a piece of the action?

Tax Commissioner Michael D’Ascenzo must step in and stamp his authority here as the reputation of the tax office is at stake. All we are witnessing here is another rich and famous guy being let off the hook by the Tax Commissioner while he mercilessly penalises and prosecutes salary and wage earners and small business taxpayers with pitiless abandon. Let me tell you I have seen some ridiculous tax bills issued to small business taxpayers over the years where the Commissioner will not bend a centimeter in settlement negotiations.

When D’Ascenzo came to office in January 2006 he promised to improve public faith in the tax system in the wake of the controversial tax settlement involving the former Reserve Bank board member Robert Gerard. He said back then, “The ATO must listen to and respond to community concerns and be more transparent and accountable for our actions. Another priority is continuing to demonstrate the highest standards of professionalism, probity and integrity in all our decision making activities. We have a proud reputation for honesty, and we want to keep it that way.”

A liberal senator who sits on one of the Parliamentary committees overseeing the ATO told me today that any secret settlement would be pursued in Parliament. “We thought the tax office were moving away from these sorts of things”, he said. The Assistant Treasurer Peter Dutton refused to comment as the matter was before the court.

D’Ascenzo would be stupid to settle this case because I think he’s buying into a monumental PR disaster. If he doesn’t sniff the wind on this I believe Parliament should change the tax secrecy laws to allow greater scrutiny of these secret settlements.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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