TAX NEWS - 2010

Tax Havens Exposed

Investors should stand by for some important changes as the clock ticks over to the new financial year on Thursday.

In the wake of the global financial crisis, blamed by some on poor regulation of financial and investment markets, the pendulum is swinging the other way.

Stricter regulations will start to put a dampener on "free marketers" with a new raft of rules to be introduced, from bigger penalties for tax evasion to the handing over of market supervision to the Australian Securities and Investments Commission.

Among the crackdowns are:


TAX HAVENS EXPOSED

Tax evaders hiding shady gains in sunny places face harsher penalties from July 1, when the tax office ends its amnesty on hidden offshore income.

Since the amnesty was announced in 2007, about $406 million in income has been uncovered in overseas tax havens, giving the ATO some $73 million in extra tax.

The deal gives those who come forward reduced penalties and a guarantee the ATO will not start a criminal investigation into their tax affairs.

But ATO Commissioner Michael D'Ascenzo warns that after July 1, penalties could be as high as 90 per cent of undeclared income and serious cases will be prosecuted.


PERSONAL TAX CUTS

The income at which the 30 per cent tax bracket cuts in rises from $35,001 to $37,001 from July 1. For higher income earners making $80,001 to $180,000, the marginal rate decreases from 38 per cent to 37 per cent.