TUESDAY, AUGUST 30, 1977
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REVENUE INVESTIGATORS HARD ON THE HEELS OF TAX DODGERS
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INVESTIGATORS OF THE INLAND REVENUE DEPARTMENT BROUGHT TO LIGHT 82 CASES OF TAX EVASION INVOLVING $14.9 MILLION IN BACK TAX AND PENALTIES IN THE FINANCIAL YEAR 1976-77, A SPOKESMAN FOR THE DEPARTMENT SAID TODAY.
ABOUT $19.8 MILLION IN BACK TAX AND PENALTIES FROM COMPLETED AND NON-COMPLETED CASES WERE COLLECTED IN THE SAME PERIOD. THIS REPRESENTS AN INCREASE OF 69 PER CENT OVER THE COLLECTION FOR THE PREVIOUS YEAR. AT MARCH 31, 1977, 211 CASES WERE UNDER ACTIVE EXAMINATION AND PRELIMINARY ENQUIRIES HAD BEEN INSTITUTED IN A NUMBER OF OTHER CASES.
COMPARED WITH THE PREVIOUS FINANCIAL YEAR, FIVE MORE CASES OF TAX EVASION, INVOLVING $5.3 MILLION IN BACK TAX AND PENALTIES. WERE COMPLETED AND $8.1 MILLION MORE IN BACK TAX AND PENALTIES WERE COLLECTED.
THE SPOKESMAN POINTED OUT THE AVERAGE UNDERSTATEMENT OF $942,000 PER CASE DURING THE YEAR REPRESENTED A STAGGERING INCREASE OF $343,000 CVER THE PREVIOUS FINANCIAL YEAR. THIS WAS A REFLECTION OF THE LARGER PROFITS INVOLVED.
AT THE SAME TIME, HE SAID, THE RATIO OF UNDERSTATED EARNINGS OR PROFITS TO TOTAL EARNINGS OR PROFITS HAD INCREASED BY 4.5 PER CENT TO 78.5 PER CENT IN THE LAST FINANCIAL YEAR. THERE IS NO DOUBT THAT TAX EVADERS ARE CONTINUING TO UNDERSTATE A SIGNIFICANT PROPORTION OF THE IR PROFITS.
ALTHOUGH PROSECUTIONS FOR INCORRECT RETURNS WERE INSTITUTED DURING THE YEAR, THE MAJORITY OF THE OFFENCES WERE DEALT WITH ADMINISTRATIVELY, HE SAID.
+THIS WAS BY MEANS OF COMPOUNDING FOR A MONETARY SUM OR BY THE COMMISSIONER OR DEPUTY COMMISSIONER PERSONALLY EXERCISING THE IR POWERS TO IMPOSE ADDITIONAL TAX UNDER THE INLAND REVENUE ORDINANCE AS PENALTY, + HE EXPLAINED.
IN A BID TO STEP UP ITS INVESTIGATION WORK, THE INLAND REVENUE DEPARTMENT HAS SET UP A NEW UNIT DURING THIS YEAR TO UNDERTAKE THE DETAILED EXAMINATION OF SUSPECTED CASES.
WITH THE CREATION OF THE INVESTIGATION UNIT, THE SPOKESMAN SAID, THERE WAS A SIGNIFICANT INCREASE IN THE NUMBER OF INVESTIGATORS AND SUPPORTING STAFF.
THE DEPARTMENT HAD SENT A SECOND OFFICER TO ATTEND AN INVESTIGATION COURSE HELD BY THE UNITED STATES INTERNAL REVENUE SERVICE AS PART OF AN EFFORT TO IMPROVE THE EFFECTIVENESS OF THE INVESTIGATION UNIT.
+EXPERIENCE HAS SHOWN THAT AN ATTACK ON A MUCH BROADER FRONT IS NECESSARY IF THE RISK AND CONSEQUENCES OF DETECTION ARE TO BE SUCH AS TO DETER WOULD-BE EVADERS, THE SPOKESMAN SAID. HE STRESSED THAT IN ADDITION TO THE CASES HANDLED BY THE INVESTIGATION UNIT 130 SMALLER CASES OF EVASION WERE HANDLED BY THE SALARIES TAX AND PROFITS TAX ASSESSORS AS PART OF THEIR NORMAL DUTIES. TAX AND PENALTIES OF ABOUT $1.3 MILLION WAS ASSESSED AS A RESULT OF THESE ENQUIRIES.