In my opinion it has been happening for quite some time.

The risk for financially successful Australians in keeping significant amounts of money in Australian bank accounts and holding assets within Australia is becoming far too high after recent actions by the ATO which have made the idea of a democratic Australia look like a sad and distant past.

Did you know the ATO can garnish a company’s or individual’s bank accounts? i.e. take your money without notice often on alleged tax bills that often prove to be never owed. This leaves the individual or company in a position where, financially, they do not have the resources to defend against the ATO’s actions in a court of law. In this way the ATO wins without having to prove a thing. Americans are aghast at the Australian law system (surrounding the ATO) of being guilty and punished before proving innocence. Plus if you tell even your wife you are under investigation, you’re breaking the law.

The ATO often do the dirty work of a disenchanted spouse or ex-employee of the wealthy, to target them based on false and malicious accusations which are simply used to serve vendettas.

Is this fair or even appropriate?

The following article in today’s major Newspapers about Property Developer’s should send shockwaves to any hard working Australian who desires to build a successful business or investment portfolio.

This will require a whole new re-think for leading accountants and Financial Educator’s on how Australian’s can hope to protect themselves and their assets  against such a communistic ATO regime that appears to be out of control.

Here are my predictions:

Politician’s will continue to ignore the community concern unless enough Australian’s stand up against this communistic behavior.

However as a very large percentage of our society isn’t wealthy then the politicians know it’s a vote winner to target the so called rich. (‘The tall poppy syndrome’; Australians generally tend to be envious of the wealthy)

Australia’s reputation will all but be destroyed internationally, if it hasn’t already, from the perspective of being an investment location.

The Paul Hogan case has been big news overseas and has caused wide spread damage.

The grab regarding the Mining tax also damaged Australia.

The ATO’s freezing of a leading Private Equity Company’s NAB bank account for an alleged $600 million liability from the sale of Coles Myer float also did untold damage.

Considering Australia relies on Foreign Investment for its daily existence to fund our massive Current Account Deficit this spells danger for our economic future. It also means a further ‘brain drain’ of Australia’s best entrepreneur’s, celebrities, international sports stars, inventors etc. who simply won’t take the risk to keep all their assets in Australia because they simply aren’t safe even if you are an honest Australian tax payer.

Allowing a country to be destroyed by a greedy bunch of overzealous government bureaucrats simply on a ‘witch hunt’ is appalling. Many Australian’s are too fearful to speak out, in case they become the next targets. Fortunately Hoge’s is not backing down and is speaking out against the ATO’s atrocious tactics. This should give more Australians the confidence to do the same.

I believe, however, that the ATO will begin to target anyone that is outspoken regarding their attacks on Australian tax payers. It is not just the wealthy that they target; Many middle class Australians have and will continue to be bankrupted by the ATO on suspect tax assessments.

The so called success of Wickenby Project that was meant to recover all this money wealthy Australians were apparently not paying tax on has lost the Australian taxpayer over $110 million already.

The ATO to get its increased funding has been cooking its own books and ironically charging others for supposedly doing the same. The ATO has told the Government the Wickenby Project has generated $855 million dollars in tax assessments. However the facts are it has only generated $193 million in cash yet spent $300 million to date.

And the only high profile scalp has been poor Glen Wheatley who was jailed as an escape goat for a measly $300,000. Hardly a huge amount for such draconian actions.

The question is who audits the tax office?

Who audits ASIC?

Most Government Departments are a law onto their own. They hire bureaucrats who generally feel insignificant in their lives, who are placed in a position of power to target people unfairly and as a result this leads to abuse by Government employees.

And because of the actions of these individuals Australia’s reputation has been severely damaged.

Jamie McIntyre
CEO 21st Century Education

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Hoges a victim of tax witch-hunt says developer Craig Gore

• By Susannah Moran
• From: The Australian
• August 30, 2010

PROPERTY developer Craig Gore has been hit with more than $70 million in tax bills and was once banned from leaving the country under a controversial Departure Prohibition Order – and now he says he knows how Paul Hogan feels.

Mr Gore has told The Australian he feels for the actor, and believes that he too, has been pressured by the tax office’s use of its wide-ranging powers into paying disputed tax bills.

Public attention on the case of Hogan, and debate around the merits and expense of the tax office’s pursuit, has shone a light on the often aggressive tactics employed in seeking redress from high-profile taxpayers.

Hogan’s fight with the tax office made headlines around the world after the famous actor was recently hit with a Departure Prohibition Order, forcing him to remain in Australia until he settles his tax dispute or goes to court to have it overturned.

Hogan has been the subject of a tax investigation as part of the nation’s $300m Wickenby probe into offshore tax havens. He denies any wrongdoing and has not been charged with any offence.

Mr Gore was reading about Hogan’s plight when it became public last Thursday, the same day Mr Gore was contacted by his bank manager and told his accounts had been frozen, pending a garnishee order from the tax office, which was demanding more than $800,000. (Mr Gore’s tax problems pre-date the launch of Wickenby in 2005.)

The move angered Mr Gore as he was due to meet the tax office this week over a previously agreed settlement of $413,000, and believes the latest action was a tactic to put pressure on him ahead of the meeting.

“It is intentionally vexatious – there can be no other explanation for it,” he told The Australian.

Since he came under the spotlight of the tax office six years ago, Mr Gore said he had been issued with bills worth more than $70m, but most of them had come to nothing and he was continuing to fight against what he said were “fictitious tax liabilites”.

“I have had enough,” Mr Gore said, of deciding to speak out.

Like Hogan, Mr Gore was the subject of a Departure Prohibition Order in 2008, and says a tax officer rang one day to ask if he was planning on travelling in the next few weeks. Mr Gore regularly travelled every two weeks or so for business, and said as much. But he was shocked when the tax office slapped him with a DPO, saying they thought he was planning to move all his assets overseas and flee the country.

“I asked them what evidence they had, because all my assets were in Australia,” he recalled.

Mr Gore believes a disgruntled contractor had contacted the tax office. The DPO was later lifted and although a complaint was lodged with the tax office, it told Mr Gore its officers acted within its policy guidelines and the complaint would not be taken further.

Mr Gore is the son of the late Mike Gore, one of the “white shoe brigade” of Gold Coast property developers who became famous in the 1980s. Gore Sr developed the famous Sanctuary Cove in Queensland, but left Australia for Canada in the early 1990s, owing millions. He died in 1994, age 53.

“My father fled the country, so they assume I am going to do the same? Give me a break,” Mr Gore said.

A tax bill was even sent to Mr Gore’s offices two years ago – addressed to his father.

“He had been dead for 15 years,” Mr Gore said, adding he had never had a business relationship with his late father.

In correspondence to Mr Gore, the tax office apologised for the mistake, describing it as “no more than an administrative error”.