ATO issues new warning to GST fraudsters after search warrants, saying “we will be recouping the funds” one way or another

The Australian Taxation Office has leveled a last-chance notice to attempted GST fraudsters, after joining forces with the Australian Federal Police (AFP) to execute new search warrants on those suspected of promoting the scam.

On Monday, the tax office issued another public warning against the practice, which involves creating a fake business with a dummy ABN, filing a fraudulent BAS, and claiming GST refunds for purchases which were never made.

The scam rose to prominence last year, when the ATO revealed fraudulent GST refunds had successfully siphoned $1 billion from the public coffers.

The ATO now claims to have stopped $2.5 billion in fraudulent GST refunds as of December 2022, while launching compliance action against 53,000 individuals with suspected links to the scam.

The joint operation, dubbed Operation Protego, has already led to 87 arrests across the country, the AFP states.

Two people have been jailed for their involvement with the scam, with further charges expected in the months ahead.

The latest crackdown came last week, when the ATO’s Serious Financial Crime Taskforce and the AFP executed search warrants on 10 individuals across three states over their alleged promotion of the scam.

“The fraudulent activity has been circulating as online advertising and content, particularly on social media,” the ATO said.

The tax office claims bogus social media posts offer unsuspecting businesses access to ATO loans or COVID-19 disaster payments, neither of which are provided by the tax office.

“We are working with digital platforms to shut down this advertising,” it added.

The ATO has also filed warnings to an additional 20,000 people suspected of involvement.

“Come to us first”: ATO

With its crackdown in full force, the ATO says anyone involved in the GST fraud should speak up now, lest they face the full force of the law.

“We are urging anyone already involved to come forward now on a voluntary basis rather than face tougher consequences later,” the ATO said.

“We will be recouping the funds, and there will be a better outcome for you if you come to us first.”

The tax office took a slightly more conciliatory tone towards taxpayers duped into the scam by fraudulent social media posts.

This includes individuals conned into signing up for an ABN they never needed, as only those conducting a business are required to use an ABN.

Business owners who believe their identity and personal details were compromised by GST fraudsters should also speak to the ATO.

“If you become involved in this arrangement, talk to us now,” the tax office said, claiming it can point taxpayers to appropriate self-help options.

Such options include revising a BAS, cancelling an ABN, ending GST registration, or setting up a payment arrangement to reimburse the tax office for wrongly-obtained funds.

“Tax fraud, evasion and crime is not victimless,” the ATO added.

“It’s a serious offence that takes money away from the community and away from essential services like health and education.”