In Australia in the s, a complicated method of avoiding company tax became popular. This method involved either stripping a company of its assets before tax became payable, or using another company as the entity which became liable for tax but ensuring that it never had sufficient assets to pay the money owed. These schemes were labelled "bottom of the harbour" schemes because the records of the stripped companies were, figuratively, sent to the bottom of Sydney Harbour once they had served their purpose.
Toggle navigation. Bottom of the harbour tax avoidance schemes involved stripping a company of its assets and leaving it with unpaid tax liabilities. The company was then sold to someone else often the criminal elements of Melbourne dockworkerswho subsequently destroyed the company records and disappeared.
Release Type: Media Release. Already the Treasurer, John Howard- has done more to eliminate tax avoidance and evasion schemes than any Treasurer in the history of the Commonwealth. Some of the rewards that honest tax payers are reaping fromr the Government's unremitting campaign against tax evasion are particularly evident in this year's budget.
Bottom of the harbour tax avoidance was a form of tax avoidance used in Australia in the s. Legislation made it a criminal offence in ; the practice came to symbolise the worst of variously contrived tax strategies from those times. The operation at the heart of bottom of the harbour schemes was simple.
Bottom of the harbour tax avoidance was a form of tax avoidance used in Australia in the s. Legislation made it a criminal offence in The practice came to symbolise the worst of variously contrived tax strategies from those times.
The deliberate stripping of a company's assets so that it is unable to pay its debts is a time-honoured practice. It also happens to constitute a criminal fraud. During the s in Australia, variations on this practice were employed by hundreds of more affluent members of the community to avoid paying taxes.
He later denied the assertion, despite millions around the world hearing him make the statement. While most people try to be a little bit smart about minimising the tax they have to pay, others are not so subtle. Over the centuries many have skilfully avoided taxes but governments often respond by changing rules, closing loopholes or seizing what is owed.
In our opinion, the investigation reveals a link between white-collar taxation fraud and known criminals. Decisions of the Barwick High Court gave powerful encouragement to entrepreneurs of tax evasion. But it was not until Januaryin The Australian Financial Reviewthat the term 'bottom of the harbour' appeared, apparently for the first time.
Tax avoidance is so prevalent across Australia's business sector now it rivals the infamous "bottom of the harbour" tax schemes of the s and 80s, enabled by immoral behaviour from accountants, a former head of the profession's peak body has warned. John Miller said the infamous "bottom of the harbour" tax schemes back then were "no more scandalous" than some of the aggressive tax minimisation strategies used by multinational companies today. John Miller believes the leadership of the profession no longer had the same clout as it did 30 years ago.