ATO Data Reveals Shocking Scale of Tax Havens in Australia

According to new data released by the Australian Taxation Office (ATO), a staggering $10 trillion is held in assets by accounts linked to secrecy jurisdictions. This figure, equivalent to approximately 15.6 trillion US dollars, has raised concerns about tax evasion and money laundering.

Notorious Tax Havens Dominate Top 10 List

The top 10 jurisdictions for large account balances are all notorious tax havens. The Marshall Islands rank first, with nearly half a billion dollars in Australian bank accounts despite having a population of just 60,000 and a GDP per capita of less than $6,000.

“It’s unlikely that most of this money comes from people who actually live there,” said Mark Zirnsak, who analyzed the data. “There are serious risks that some of the money is being laundered through Australia.”

The ATO has implemented information-sharing arrangements with six of the 10 jurisdictions identified in the list, including Jersey, Cayman Islands, Bermuda, Antigua and Barbuda, Guernsey, and Gibraltar. However, critics argue that this is not enough to prevent tax evasion and money laundering.

“The places where account holders are from that have the largest average account balances are all notorious tax havens,” said Zirnsak. “We need a public register of the beneficial ownership of companies and trusts so financial institutions can know who they are really dealing with and fulfill their obligations to prevent money laundering.”

Concerns About Front People and Concealed Ownership

The data also reveals that many Australians may be using front people in tax havens to conceal their ownership of some of these funds.

ATO Successes, But More Needs to Be Done

The ATO has raised $22.9 billion in tax liabilities and collected $15.9 billion in cash since 2016. However, critics argue that more needs to be done to prevent offshore tax evasion.

“We also need reform to our anti-money laundering laws so that businesses and professionals that set up companies and trusts are required to report suspicious matters to AUSTRAC,” said Zirnsak. “They should also be required to not do business with people they suspect are likely to be involved in criminal activity.”

Country Breakdown of Funds Held in Australian Accounts

The total amount of money held in Australian accounts by US residents is approximately $88 billion, followed by China ($28 billion), the UK ($21.5 billion), Singapore ($14.4 billion), and New Zealand ($13.9 billion).

Call for Action: Registering Beneficial Ownership

Critics argue that the disproportionate prevalence of tax havens on the list highlights the need for a register detailing who really owns the money parked in Australian bank accounts.

“We need to legislate for a register detailing who really owned the money parked in Australian bank accounts, so ownership wasn’t hidden behind shell companies and trusts,” said Zirnsak.