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AAT cautions ATO on labelling taxpayer as dishonest in GST case


A belligerent taxpayer does not necessarily equate to a dishonest one, the Administrative Appeals Tribunal has told the ATO as it overturns a GST and LCT decision.

By Jotham Lian 11 minute read

The AAT has ruled that a motor vehicle dealer was entitled to GST input tax credit (ITC) of $19,809 and a luxury car tax (LCT) decreasing adjustment of $45,843 in relation to the acquisition of an Audi R8 Coupe for $263,750.01, after the ATO commissioner had earlier disallowed the claim.

The dealer, Anastassios Skourmallas, believed he was entitled to the ITC and decreasing adjustment because he acquired the Audi R8 as trading stock for his motor dealer business, but the ATO did not accept that he was a motor vehicle dealer or that the car was acquired for business purposes.

The counsel for the commissioner had submitted that Mr Skourmallas was “not a credible witness”, alleging that he was evasive in his answers and was argumentative, among other allegations.


However, AAT senior member Robert Olding dismissed the allegations that Mr Skourmallas was not a truthful witness.

“Listening to Mr Skourmallas responding to cross-examination, I could understand how an impression of belligerence might be formed,” Mr Olding said.

“His responses were certainly agitated and argumentative at times, but that has to be considered against the background already mentioned and the context in which the questions were asked.

“The difference between the submissions made on behalf of the commissioner in this case and my own reaction to the evidence of Mr Skourmallas underlines, with respect, the care needed in concluding that a taxpayer is dishonest,” Mr Olding said.

“Several of the examples cited by the commissioner as suggesting dishonesty, upon close examination, took on a more benign complexion, especially when considered in the light of Mr Skourmallas speaking English as his second language, his communication style, and the nature of his activities as he explained them.”

In concluding that Mr Skourmallas was entitled to GST ITC and the LCT decreasing adjustment, Mr Olding established that Mr Skourmallas was indeed carrying on an enterprise, despite not having a showroom, car yard or other such indicia of a conventional motor vehicle dealership.

The AAT also considered the private usage of the vehicle, the vehicle insurance and the personalised number plate in its decision.

“I accept that the relatively low kilometres travelled by the vehicle for most of the period that Mr Skourmallas held the vehicle are not inconsistent with an intention to hold it only as trading stock,” Mr Olding said.

Jotham Lian

Jotham Lian


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.

You can email Jotham at: This email address is being protected from spambots. You need JavaScript enabled to view it. 

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