The Federal Court has agreed to declarations sought by the Tax Practitioners Board (the Board) that the respondent, who failed to appear before the hearing, had on 18 occasions committed contraventions of s 50-5(1) of the Tax Agent Services Act 2009 (the Act) – namely, that he had provided a service that he knew or ought reasonably to know was a “tax agent service” and had received a fee service in circumstance where he was not a registered tax agent. Furthermore, each of the contraventions, but one, resulted in a “tax mischief”, in that the conduct of respondent “led to the taxpayers making unsubstantiated claims for deductions to which they were not entitled”, and without instructions to do so.
In granting the relief sought by the Board, the Court took into account the following matters: the need to protect the public, the need for both general and specific deterrence are relevant, the fact that the breaches appeared to be knowing and intentional and that the contraventions resulted in tax audits of individual taxpayers, which, in turn, resulted in the imposition of significant penalties on some of the taxpayers. Accordingly, the Court found it appropriate to impose a pecuniary penalty of $64,500 and impose on injunction to the effect that for a period of 3 years, if he was requested to provide a tax-related service he must first be a registered tax agent and, also, before providing the service inform the other party the above matters and contraventions.
(Tax Practitioners Board v Campbell [2012] FCA 1153, Federal Court, Emmett J, 24 August 2012.)
[LTN 205, 23/10]