The Joint Chiefs of Global Tax Enforcement, known as the J5 — made up of Australia, the United Kingdom, the United States, Canada and the Netherlands — have now turned their eyes towards professional enablers of white-collar crime, warning them that their days are short-lived as tax administrators begin to work closely together.
ATO deputy commissioner and Australia’s J5 chief, Will Day, said that with tax crime now rapidly evolving to evade tax administrators, attention will now be placed on tax practitioners who help people navigate and access sophisticated schemes.
“It’s always worth observing that the vast majority of accountants and tax agents and lawyers and other sorts of professionals play a really positive role in the tax system — they do make sure people understand their obligations and help them to meet those obligations,” said Mr Day on the ATO’s official podcast, Tax inVoice.
“But we do see a very small percentage who have a very active role in facilitating offshore tax evasion, the phoenix arrangements, the money laundering, and tax avoidance through cryptocurrencies.
“We’ve got a particular focus over the coming years on promoters of tax crime, whether they’re located in our, one of our five countries or offshore, we’ve got a particular focus on offshore service providers, and we’ve got a particular focus on offshore financial institutions and the roles that they might play in facilitating tax crime.”
Earlier this year, the J5 launched a globally co-ordinated investigation into a Central American bank suspected of facilitating money laundering and tax evasion for customers across the globe.
The ATO has since engaged directly with 14 Australian clients suspected of having undeclared income, with several hundred other Australian taxpayers suspected of being involved in similar arrangements.
Don Fort, chief of the US Internal Revenue Service (IRS) Criminal Investigation, said such globally co-ordinated actions demonstrate the real operational ability of the J5, warning professional enablers that they will be found out.
“The worldwide message when we do things, like the publicity around the day of action, it should really put pressure on those enablers that are operating in lots of different countries, that the world is getting smaller, and we’re making it smaller through things like the J5 and the work that we’re doing in the J5,” Mr Fort said.
“Every day, we’re learning from each other, increasing our capabilities by leaps and bounds.”
Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.