The Australian Taxation Office (ATO) recently filed an application in Federal Court to pursue penalties against a former EY partner over an alleged tax exploitation scheme.
The ATO said it was taking the action under "promoter penalty" laws, which allow it to penalize individuals who promote tax exploitation. "Promoter penalty laws are in place to deter and disrupt the promotion and implementation of aggressive tax avoidance and evasion schemes," the ATO said.
"The promotion of tax exploitation schemes undermines the integrity of the tax and super system and challenges community trust and confidence. These schemes create an uneven playing field for everyone, including businesses and advisers," the Office added.
The ATO's action against the former EY partner comes on the heels of a high-profile tax scandal in which a PwC partner shared confidential government information to help clients evade taxes. This has sparked outrage amongst politicians and the public, and responsive legislation is currently making its way through Parliament to increase the penalties for such behavior.