April 10, 2018 / 9:40 AM / 16 days ago

Australia to investigate tax body over abuse-of-power allegations

SYDNEY (Reuters) - Australia’s government will investigate the country’s taxation body after former staffers of the revenue-raising institution told local media it unscrupulously targeted individuals and small businesses to meet budgetary targets - allegations the tax office denies.

Citing two whistle-blowers, the Australian Broadcasting Corp and Fairfax Media Ltd (FXJ.AX) on Monday reported instances of abuse of power by the Australian Taxation Office (ATO) including claims of unethical tactics used to raise revenue at the expense of fairness.

“The Minister has requested a thorough investigation of all allegations raised,” a spokesman for the financial services minister told Reuters in an emailed statement. “The Government will be responding once it has had an opportunity to consider that in detail.”

The claims were primarily made by Richard Boyle and Ron Shamir, former employees of the ATO, which collected A$360 billion ($278.14 billion) in revenue last year.

Among the claims were instances where Boyle and his tax collection colleagues were instructed by superiors to seize funds from the bank accounts of individuals assessed to owe money, regardless of their particular circumstances.

The reports also quoted Inspector-General of Taxation Ali Noroozi, ATO’s key supervisory figure, in an interview estimating the tax office would get about one in 20 cases wrong.

“There is absolutely no evidence that in roughly 5 per cent of cases the Tax Office gets it wrong,” the ATO said in a statement on its website Tuesday. The feedback it receives from “credible sources” is “consistently positive ... about how we listen and respond to their needs,” it said.

“The media have taken a handful of isolated cases, presented only one side of the story, and then extrapolated these to suggest systemic issues with our administration,” the ATO said.

    Reporting by Paulina Duran; Editing by Christopher Cushing

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