Dealers get tax refunds????

From ABC Online

Posted: Tue, 10 Jun 2003 5:39 AEST

Criminal's tax deduction slammed by NSW
The New South Wales Government is calling for a prompt change in federal tax laws, which have allowed a convicted drug dealer to claim a massive deduction for money stolen during a drug deal.

The Federal Court has now twice upheld a decision in favour of the convicted drug dealer from Perth against the Australian Tax Office, in relation to a $224,000 deduction.

The Special Minister of State in New South Wales, John Della Bosca, says it is time for the loophole to be closed as it is undermining efforts by the states to deal with drug-related crime.

"In New South Wales we're spending a fortune on drug programs in health and police portfolios," he said.

"New South Wales has already got tough legislation to confiscate the proceeds of crime, meanwhile the Commonwealth Government is giving drug criminals a quarter of a million dollar tax deduction."


JoKeR

more details

What i believe happened in this case is ,from the evidence the DD gave in court, the australian tax office calculated his annual earnings and then charged an according tax bill.
The DD didn't declare the income himself.
so to counter the massive tax bill that he got ( i think it was about a $450,000 tax bill) he decided to claim deductions.
one of these deductions was when $224,000 was stolen from him.
so in reality he has just minimised his tax like most australians do. But he still has a $225,00 tax bill left to pay and i believe all his assets were confiscated under WA drug laws
of course most of this information is left out beacuse it doesn't make such a good story.

So let me get this straight, the Tax department can charge you with Tax, on income that they determine that was accumulated illegally and was as a result undeclared? On top of this the Police can at the same time confiscate everything you have as it was acquired with monies derived from illegal activities. So not only are you broke and in jail for the next couple of decades you also need to find a way to pay back the tax office for earnings another branch of the government has taken from you. Shit after 20 years of compounded interest on your bill plus fees charges and late fines you will need to get back into hard core dealing pretty fast to pay the sum back before you die.

JoKeR

You just summed up the dealer´s dilemma! This has happened on a smaller scale in my homecountry, not the claiming of deductions but I mean the whole vicious circle.

Some guys I knew of came out of prison owning nothing and owing tons of money in taxes, and were declared bankrupt. As a result they couldn´t own anything legally or get any loans, and because of the convictions they couldn´t get decent employment. What they did was get their relatives to sign up on loans for associates who were not bankrupt, use the money to buy large amounts of drugs and sell them.

They were subsequently arrested again, but had managed to pay off their bills to the government. Surprise surprise, all their income was declared illegal except of course what they had used to pay the government back for the outrageous original verdict.

Bwah, I hate the government sometimes, the law can always be messed around and thrown between different agencies to screw you in the end, the law is basically what they want it to be (at least in my experience).

--- G.

It should be illegal for all those rich pompus bastards to "minimize" their tax via shifting money around and paying $2 a year where as the average joe has to pay up!