TaxBlog

Michael Hill International today announced that they would be moving their operations to Australia to save tax.

The restructuring “will materially and positively affect the after-tax profits and cash flow of the group,” chairman Michael Hill said in a statement. “This fundamental shift in functions has also required the Group to review its existing international transfer pricing arrangements which are in place for taxation purposes.”

It looks like there is nothing that the NZ revenue authorities can do to stop other NZ companies from following suit.

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THE actor Paul Hogan has broken years of silence to mock reports that he is caught up in a probe into serious tax fraud.

The Crocodile Dundee star is under investigation over allegations that tens of millions of dollars of film royalties were passed through offshore tax havens.

He is thought to have recently moved his family from Byron Bay’s hinterlands to the US.

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The Australian Government has passed new powers to crack down on people who cross the Tasman to escape their tax debts.

The International Tax Agreements Amendment Act is a result of the tax treaty signed by Australian Treasurer Peter Costello and New Zealand Finance Minister Michael Cullen last November.

It allows the Australian Taxation Office to track down New Zealanders living in Australia who have evaded paying tax in New Zealand.

And it will also let Inland Revenue in New Zealand to do the same to Australians.

The law was passed by the Australian parliament on Thursday.

The new laws will make it easier to collect such debts and pay them back to the other country.

“This measure will treat Australian tax debts collected by a foreign taxation authority that have been remitted to Australia as tax debts collected in Australia,” the Treasury said.

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The Australian federal government expects its tax revenue to be boosted by more than $320 million from Australia’s biggest ever tax evasion crackdown.

The tax office’s estimate on the amount of lost revenue it expects to recoup indicates the $300 million operation will be a break-even proposition or better.

Operation Wickenby, a multi-authority investigation that includes the Australian Crime Commission and the Australian Tax Office (ATO), is investigating a range of schemes aimed at tax avoidance and minimisation.

“The tax office expects the Operation Wickenby to result in increased tax revenue of $323 million by the end of the 2009-10 financial year through compliance activities and improved compliance behaviour by the relevant taxpayers,” the ATO said in a statement.

“The tax office also believes that the operation will result in additional revenue being collected under the Proceeds of Crime Act 2002, although the tax office is unable to estimate these amounts at this early stage.”

The ATO was careful to emphasise that the investigation was not a revenue raising exercise.

“Operation Wickenby is driven by protection of the revenue base rather than pursuit of additional revenue, as there is no doubt participation in these or similar arrangements will spread if not acted on,” the ATO said.

“For this reason, the revenue estimates are conservative and based on what was known at the time of the joint agency costing proposal in October 2005.”

Wickenby has involved some high-profile operations, including a sweep last year by the tax office and crime commission in which they executed 48 search warrants in Perth, Sydney, Melbourne and Brisbane.

Does anyone believe it’s not a revenue gathering operation? Yeah Right.

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