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THE Australian Taxation Office and federal law enforcement
agencies want to intensify their campaign against offshore tax
evasion, with increased penalties and greater powers for
investigators expected to be considered by the federal
government this year.

Documents released under freedom-of-information laws reveal the
Tax Office and other agencies participating in the long-running
Project Wickenby, an inter-agency task force targeting offshore
tax evasion, have been developing a comprehensive range of
measures to combat abuse of "secrecy havens" - countries with
secretive tax or financial systems and which offer minimal
taxes for non-residents.

The ATO is seeking the introduction of measures to stem tax
evasion before funding for Project Wickenby expires next year.

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Documents released by the Attorney-General's Department show
the ATO has convened a series of meetings and workshops to
develop tax reform proposals with the Australian Crime
Commission, the Australian Federal Police, the Commonwealth
Director of Public Prosecutions, the Australian Securities and
Investments Commission, the anti-money laundering agency
AUSTRAC, the Treasury and the departments of the
Attorney-General, and Immigration and Citizenship.

New anti-tax avoidance measures being developed include
improved information flows between Australian government
agencies such as better sharing of information obtained through
the use of coercive powers like those exercised by the
Australian Crime Commission; 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 Project Wickenby agencies have also been considering
increased penalties for offshore tax evasion; measures aimed at
"addressing delays around legal professional privilege";
amendments to immigration requirements to ''consider failure to
comply with tax obligations'', and greater regulation of
trusts.

A number of "defensive 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, with the Treasury and
Attorney-General's Department potentially making a joint
submission.

However, the Attorney-General's Department has declined to
release the detailed policy proposals, saying: "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 the
actor Paul Hogan.

Nearly $594 million in outstanding tax revenue has been
recovered, while $1.18 billion in tax liabilities has been
raised.

Since 2007-08 there has been a 22 per cent reduction, about $22
billion, in funds flowing from Australia to 13 overseas
"secrecy havens".

There has been a decline in fund flows of 50 per cent to
Vanuatu, 80 per cent to Liechtenstein, and 22 per cent to
Switzerland.

By 2012-13, Project Wickenby operations will have cost $430.9
million.

The Assistant Treasurer, Mark Arbib, confirmed yesterday that a
"multi-agency working group" was working on further measures
aimed at cracking down on illegal offshore tax evasion.

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More power for ATO, police to catch offshore tax cheats