A developer who conspired to lodge fraudulent business activity statements (BAS) has been convicted and sentenced to 10 years in jail with a non-parole period of 6 years and 8 months.
Li Zhang was involved with two companies that formed part of a group known as the ‘Hightrade Group’. The Hightrade Group developed properties such as a hotel and golf course in the Hunter Valley, New South Wales.
Mr Zhang fraudulently obtained GST refunds by using three tiers of companies (developers, building companies and suppliers) to grossly inflate the construction costs of his developments. The companies he was involved with also claimed to have purchased goods when no such purchases had occurred. In total, Mr Zhang intended to cause a loss to the Commonwealth of more than $15 million. His sentencing has closed a complex case, known as Operation 4.
Assistant Commissioner Jade Hawkins said, ‘Tax crime, like the fraud uncovered in Operation 4, affects the whole community.’
‘This was not an ordinary business operating legitimately – it was deliberate and evasive behaviour. Mr Zhang undermined genuine businesses by not paying his external suppliers, and left business creditors and employees without their entitlements.’
‘Tax crime also reduces the amount of revenue available to fund essential community services, like health and education,’ Ms Hawkins said.
We take all reports of tax crime seriously. If you have any information to share, you can do so confidentially at www.ato.gov.au/tipoff or by phoning 1800 060 062.
Read our media release and find out how the scheme was established.