To avoid certain confusion I am referring to the cross-agency task force established in 2006 to protect the integrity of Australia’s financial and regulatory system by preventing people from promoting or participating in the abusive use of secrecy havens; and not the memorial project highlighting the WWII exploits of the RAF at Wickenby in the UK.
According to the Australian Taxation Office (ATO) a ‘secrecy haven’ is a country, region or state that does not divulge information about an individual’s financial/banking affairs or structures. The ATO believes that these arrangements may be exploited to conceal income and evade tax because they do not have effective information exchange arrangements with Australia.
Project Wickenby’s success has been measured by the near AUS$602.4million in tax dollars recouped; the 65 people charged as a result of investigations by the task force and the 22 convictions secured.
In fact according to the tax authorities the evidence shows Project Wickenby interventions are improving taxpayers’ willingness to comply with their taxation obligations; people who have been investigated by Project Wickenby have subsequently voluntarily lodged more accurate tax returns and paid more tax than they have done in the past; nearly $308 million made from increased voluntary compliance following interventions by the Project Wickenby task force; and $2 million in assets has been recovered under the Commonwealth Proceeds of Crime provisions.
Of course for a project that has been in operation for six years and in addition to the ATO utilises the consideration human and financial resources of the
- Australian Federal Police,
- Australian Crime Commission’
- Australian Securities and Investments Commission,
- Australian Transaction Reports and Analysis Centre, and the
- Commonwealth Director of Public Prosecutions
these bench-marks may not point to its resounding success.
Nonetheless the Australian government remains keen to continue to fund the Project by allocating a further AUS$76.8million over the next three years.
A Slight Inconsistency?
According to the Aussie tax collectors although the number of secrecy jurisdictions with whom they have no effective exchange of information is gradually shrinking they remain concerned about the lack of information exchange and transparency with key non-OECD members of the OECD Global Forum on Taxation who have each committed to eliminating harmful tax practices through transparency and effective information exchange.
- Hong Kong
Interestingly of these countries deemed ‘secrecy havens’ by Australia – itself a member of the Global Forum and therefore having a say in whether a country passes its Phase I Assessment with respect to the legal instruments in place by a country with its relevant partners to ensure exchange of tax information according to international standards – Hong Kong, Luxembourg, Seychelles and Cyrus have each received a passing grade.