Judi Moylan (Pearce, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Would the Treasurer update the House on how the Australian Taxation Office is cracking down on tax cheats who seek to rip off Australian taxpayers? How is the government assisting the Australian tax office?

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the honourable member for Pearce for her question. I can tell her that the Australian government has increased funding to the tax office by 55 per cent from 1999-2000 to 2006-07, from $1.6 billion to $2.5 billion. Between 2001 and 2006, the ATO referred 862 cases to the Commonwealth Director of Public Prosecutions. Of those, 538 defendants were convicted, 105 were sentenced to jail and 318 were fined. In the last year, in 2005-06, the ATO completed 363 audits, which resulted in adjustments of $121.4 million to tax liabilities, with $33.1 million in penalties and $21.1 million in interest. It also finalised 367 investigations. Of 107 matters dealt with by the courts during the year, 102 resulted in successful prosecution. That is a 95 per cent success rate in prosecutions. The courts imposed prison sentences ranging from three months to eight years in 56 per cent of those cases. The courts also imposed reparation orders and fines.

So the Australian Taxation Office has been extremely active in prosecuting those that engage in criminal breaches of the taxation act. The prosecution rate shows that the cases that they take are cases which are well founded, having a 95 per cent success rate. This has saved taxpayers generally hundreds of millions of dollars and in deterrence even more so, and with Operation Wickenby, the largest coordinated investigation between crime and enforcement authorities we have yet seen in Australia, we are actually taking stronger steps than ever in relation to criminal conduct against the tax system.

The object of this is to make sure that everybody pays their fair share so that Australians generally can have lower taxation. Lower taxation was introduced as a result of this year’s budget, where we raised thresholds and cut rates, and also in relation to superannuation, where the government has introduced the largest superannuation reform in Australian history. We could not do that kind of tax reform if we did not have a good system which was being observed by all, and the government supports the Australian Taxation Office in successful measures to bring that about.