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Taxman puts hero in the crosshairs

AUSTRALIAN BUSINESS REVIEW   March 7, 2019   Robert Gottleibsen

Taxation commissioner Chris Jordan is suddenly in a perilous situation. Both political parties are concerned that he has brought charges against whistleblower and national hero Richard Boyle that carry a maximum jail sentence of 161 years.

Boyle was no ordinary whistleblower because he first told the Australian Taxation Office what was wrong and only told the nation about the ATO small business abuse that he saw when nothing was done. In the current era, Jordan should have called Boyle into his office and invited him to expand on his remarks so Jordan could start doing something about it.

Instead, Boyle was treated by Jordan in the same way as tax lawyer Richard Edmonds SC claims the ATO treats taxpayers — as if they are “cheats and liars”, making any actions against them justified.

I have been writing in The Australian about the ATO’s small business abuse for about three years. Now, with the help of Boyle, both political parties have recognised the ATO’s small business abuse and both have introduced new appeal processes.

In my view, the government has the best policy and wants to set up a small business appeals tribunal reporting to the Administrative Appeals Tribunal, not the ATO. And they want the taxation commissioner to help set it up.

So far, Jordan has defied the government. So unless that attitude changes, small business tax abuse and the required appeal mechanism will be an election issue with both parties having different ways to cope with the abuse. But they are agreed on the abuse. We have never had a taxation commissioner hauled before both major parties and asked to explain. Never before have we faced an election campaign about how to overcome small business abuse by the ATO.

Jordan’s term as tax commissioner was set to conclude at the end of the year, but in April 2017 the Turnbull government, with Scott Morrison as treasurer, extended his term to 2024.

We have not reached the termination or suspension stage, but it’s worth recording the governor-general may remove the commissioner on the grounds of “proved misbehaviour or physical or mental incapacity” approved by each house in the same session of parliament.

The governor-general may also suspend the commissioner from office on those grounds, but must state the grounds of the suspension in each house of parliament and the parliament can revoke the suspension.

Small Business Minister Michaelia Cash and Assistant Treasurer Stuart Robert have asked Small Business Ombudsman Kate Carnell to examine the ATO’s practices in pursuing early recovery of tax debts from small businesses that are in dispute with the ATO. Tax officials used this practice to wipe out an industry (gold refining) by issuing huge debt notices that ranked above all other creditors, bankrupting each refiner.

Cash defiantly declared: “I am determined to make sure the Australian Taxation Office treats small business fairly.” She was preparing for the election.

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