Revised Explanatory Memorandum(Circulated by authority of the Hon Kelly O'Dwyer MP, Minister for Revenue and Financial Services, Minister for Women, Minister Assisting the Prime Minister for the Public Service)
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Electronic sales suppression tools
1.102 This Schedule is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
1.103 Schedule 1 to this Bill prohibits the production, distribution and possession of sales suppression tools in relation to entities that have Australian tax obligations. Schedule 1 also prohibits the use of electronic sales suppression tools to incorrectly keep tax records.
1.104 Schedule 1 to this Bill achieves this outcome by introducing offences of strict liability with high penalties. Applying strict liability to these offences covered by these amendments is appropriate because it substantially improves the effectiveness of the prohibition on electronic sales suppression tools.
1.105 The amount of the penalties are comparable to the penalties that currently apply to existing offences for promoting tax exploitation schemes under Division 290 of Schedule 1 to the TAA 1953 and in respect of breaches of directors' duties under the Corporations Act 2001.
1.106 The amendments are designed to act as a significant and real deterrent to those entities who seek to profit by facilitating tax evasion and fraud through the tools' production and supply.
1.107 The amendments provide offence-specific defences that ensure that entities who undertake certain conduct in relation to an electronic sales suppression tool are protected from committing an offence where their conduct is undertaken to prevent or deter tax evasion, or to enforce a taxation law. These defences operate in conjunction with the general defences for honest and reasonable mistakes.
1.108 Because an electronic sales suppression tool's principal function is, by definition, to facilitate tax evasion, there are no legitimate reasons outside of those covered by the applicable defences for an entity to produce, supply, possess or use such a tool.
Human rights implications
1.109 Schedule 1 to this Bill does not engage any applicable rights or freedoms.
1.110 This Schedule is compatible with human rights as it does not raise any human rights issues.