New tax avoidance team to scrape up billions for the federal budget

By The Mandarin

Tuesday May 3, 2016

The Australian Taxation Office is putting together a crack team to crack down on multinational tax avoidance, in a plan the government hopes will take some pressure off other parts of the federal budget.

The new ATO taskforce has been allocated $679 million over four years to help hunt down avoided tax dollars, and collect the “diverted profits tax” that was introduced last year along with stronger penalties for failure to meet disclosure and compliance obligations.

If all goes to plan, there will be an extra $3.7 billion flowing into Commonwealth coffers over the next four years.

Treasurer Scott Morrison and Assistant Treasurer Kelly O’Dwyer have decreed it “shall be a single, targeted program accountable to government” and will have about 1300 staff with “390 new specialised officers” among them.

The new team will report directly to Tax Commissioner Chris Jordan, who will in turn give “regular progress reports” to the government, with the first expected by year’s end.

Morrison and O’Dwyer say external experts will have a “critical role” to play and “a panel of eminent former judges” will review any settlements negotiated with companies that are caught out. Their joint statement adds:

“Funding will be provided to increase the ATO’s specialist audit and investigation teams dedicated to addressing international tax risks and focusing on high wealth individuals, trusts and tax scheme promoters.”

The ATO will remain involved in the Serious Financial Crimes Taskforce that was put together last year and this work will “complement” the new tax avoidance team.

Other new capabilities

The Department of Agriculture and Water Resources will get $15.9m over four years to improve its analytical capability. According to the budget:

“This measure will establish an advanced capability to turn data into intelligence for use by government entities (States and Territories), and where relevant, across industry and the wider community, to better manage Australia’s biosecurity risks.”

There is $50.5m in the budget over the next five years for the myGov web portal, with the bulk — $45.1m — going to the “core operational component”. The remaining $5.4m is to support a joint team from the Department of Human Services, Digital Transformation Office, Treasury and the Department of the Prime Minister and Cabinet to identify “future developments” for the web service.

An almost insignificant $5.3m over five years will support the development of a very significant Trusted Digital Identity Framework.

The Office of the Australian Information Commissioner gets $8.1m over four years — the office is not new, but the decision to give up on abolishing it is. The OAIC also gets another $6.7m each year for its privacy commissioner, diverted from the Australian Human Rights Commission’s budget and another $0.6m from the Attorney-General’s Department budget for its freedom of information work.

The Australian Federal Police Fraud and Anti-corruption Centre will receive $14.7 million over four years to expand its capacity to investigate foreign bribery, funded through confiscated assets.

The Department of the Environment will receive $3.5m over the next two years to “upgrade critical regulatory workflow systems” which include data management platforms and the threatened species database.

And the Northern Australia Infrastructure Facility will be a new notionally independent corporate entity on the block, with $43.8m over five years to set up and start delivering $5 billion in financing to “economic infrastructure” in northern regions.

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