Companies and people who leak confidential government tax information would be hit with multimillion-dollar fines under draft legislation to be introduced by the New South Wales government.
The bill seeks to combat confidentiality breaches after the PwC scandal involving the leaking of commonwealth tax information.
A new offence would carry a maximum penalty of $1.1m for individuals and $5.5m for corporations caught using or disclosing confidential government information. Those involved in concealing a breach would be liable for the same penalties.
The state finance minister, Courtney Houssos, said on Tuesday the new laws would put integrity “at the heart of the NSW government’s tax system”.
“We’re putting on notice people who actively and deliberately seek to mislead for personal gain,” she said. “This isn’t just about deterring people from doing the wrong thing but also holding people to account for their deception.”
The state’s public service leans heavily on consultancy firms with the auditor general, Margaret Crawford, revealing in March the NSW government had spent about $1bn on consultants between 2017 and 2022. That reliance is being examined by a parliamentary inquiry.
The proposed changes would also see the state’s chief commissioner of state revenue permitted to report offending individuals or organisations to relevant professional bodies and publish details of any breach.
The state’s payroll tax laws would also be changed to allow Revenue NSW to recover tax debts from “phoenix” operators who liquidate companies to avoid paying up.
The practice has been of major concern to both state and commonwealth regulators due to the harm it can cause to people, businesses and creditors owed debts.
According to the government, payroll tax revenue leakage from phoenix activity has been estimated at over $85m.
Houssos said the changes would help stop “dishonest” businesses. “It will also offer greater fairness and transparency for the people of NSW,” she said.
The bill will also seek to improve compliance by creating a new offence for evading or attempting to evade tax with a maximum penalty of two years in jail or a $100,000 fine.
The bill was presented to the Labor caucus on Tuesday morning and was expected to be introduced to parliament later in the day.
