GST fraud costs developer 10 years jail

10 years jail for man involved in $15 million tax fraud.

GST is a 10% tax paid on most goods, services and other items sold or consumed in Australia.

If you’re registered for GST, you can claim credits for the GST included in the price of goods and services you buy for your business or enterprise.

While most people comply with their GST obligations, a small number deliberately do the wrong thing.

Developer Li Zhang is such a person. Following one of our longest investigations, known as Operation 4, and an extradition from New Zealand, Zhang was convicted and sentenced to 10 years jail with a non-parole period of 6 years and 8 months for conspiring with intent to cause a loss to the Commonwealth of over $15 million.

Zhang fraudulently obtained GST refunds by using 3 tiers of companies (developer, building companies and suppliers) to grossly inflate the construction costs of his developments, including a hotel and golf course in the NSW Hunter Valley. The companies he was involved with also claimed to have purchased goods when no purchases had occurred.

This sentencing has closed a complex case that proves we have the resources, sophisticated data matching and analytics capability, and intelligence sharing relationships to uncover even the most elaborate tax crimes.

Tax crime affects the whole community. It reduces revenue available to fund essential community services, such as health and education.

Next step:

ATO take all reports of tax crime seriously. You can share information confidentially at www.ato.gov.au/tipoff or by calling 1800 060 062.

Check out ATO’s media release or thier infographic on how the scheme was set up for more information.

Source: ATO