The Australian Tax Office is seeking increased penalties for offshore tax evasion. Photo: Michel O'Sullivan
THE Australian Tax office is pushing for more powers to investigate secret tax havens as well as increased penalties for offshore tax evasion.
Documents released under freedom of information reveal that the Tax Office and other law enforcement agencies participating in Project Wickenby, an inter-agency taskforce targeting offshore tax evasion, have been quietly developing a comprehensive raft of new measures to combat abuse of ''secrecy havens'' - overseas countries with secretive tax or financial systems that offer minimal taxes for non-residents.
The Tax Office wants the new measures to stem tax evasion introduced before funding for Project Wickenby expires in 2013 and they are expected to be considered by the federal government this year.
Documents released by the Attorney-General's Department show the Tax Office has been working with the Australian Crime Commission, Australian Federal Police, Commonwealth Director of Public Prosecutions, the Australian Securities and Investments Commission, the anti-money laundering agency AUSTRAC and the departments of the Treasury, Attorney-General and Immigration and Citizenship to develop tax reform proposals.
These include improved information flows between Australian government agencies; greater use of telecommunications interception powers; expanding the definition of money in anti-money laundering laws, greater information exchanges with foreign governments; strengthened international debt recovery measures; and reciprocal recognition of foreign tax debts.
The agencies have also been considering increased penalties for offshore tax evasion.
A number of measures were canvassed in a submission by Treasury to federal cabinet on May 16 last year.
Further reform proposals were forecast for submission to cabinet late last year or early this year.
But the Attorney-General's Department has declined to release the detailed policy proposals, telling The Age: ''The finer details of these law reform proposals have not yet been put to ministers; there have been no major public announcements on this subject; and the issues are still at the very preliminary stages of policy development … full disclosure would … run contrary to the interests of good government.''
Since 2006, Project Wickenby has resulted in 62 people being charged with serious tax avoidance, money laundering and fraud. Twenty-one people have been convicted, although the taskforce has had setbacks, including the abortive legal pursuit of actor Paul Hogan. Nearly $594 million in outstanding tax revenue has been recovered and $1.18 billion in tax liabilities has been raised.
Assistant Treasurer Mark Arbib yesterday confirmed a ''multi-agency working group'' was working on ''cracking down on illegal offshore tax evasion''.
''We make no apologies for pursuing those who deliberately evade tax through elaborate schemes,'' he said. ''They are not just defrauding the government, they are defrauding all Australians. The government continually consults our enforcement agencies to improve and strengthen their ability to catch those who use offshore jurisdictions to avoid tax.''