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‘Under pressure’? Section 39 of the Legal Profession Uniform Law and the Federal Commissioner of Taxation
Published on 01 Jul 22 by "AUSTRALIAN TAX FORUM" JOURNAL ARTICLE
Taxation and legal professional privilege have a long history. (Indeed, it appears that one of the earliest cases to involve a claim of the privilege, Berd v Lovelace [1577] Cary 62, arose in a tax context.) Of late, however, the Australian Taxation Office (the ATO) has been bellicose in its opposition to claims of legal professional privilege. The ATO insists that legal practitioners who, in its view, make unfounded privilege claims leave themselves open to sanction for breaching their obligation to comply with the Federal Commissioner of Taxation’s (the Commissioner’s) coercive information-gathering powers (which, the ATO accepts, are subject to legal professional privilege).
What seems to have not quite received the same attention, though, are some of the prohibitions that might constrain the ATO itself in the exercise of its powers in this regard. Relevantly, s 39 of the Legal Profession Uniform Law provides that: ‘A person must not cause or induce or attempt to cause or induce a law practice or a legal practitioner associate of a law practice to contravene this Law, the Uniform Rules or other professional obligations’.
This article discusses the potential relevance of s 39 (and its equivalents in Australian jurisdictions that have not adopted the Uniform Law) to the Commissioner and to agents or officers of the Commissioner. While pursuing the hardly objectionable objective that the legally ‘correct’ amount of tax be paid, it would appear that well-meaning but overzealous ATO officers could potentially expose themselves to criminal culpability if they seek to pressure practitioners in relation to claims of legal professional privilege, contrary to s 39 and its equivalents.
Author profile
Eu-Jin Teo CTA
Eu-Jin Teo, CTA, is a prize-winning researcher and Senior Lecturer at The University of Melbourne. Co-author of Taxation Law in Context (by Oxford University Press) and updating author of the ‘Income and Assessable Income’ chapter of Halsbury’s Laws of Australia, he has been an Editorial Board member of the Melbourne University Law Review, is a former Editor of the Journal of Australian Taxation and is a member of the Law Institute of Victoria’s Taxation and Revenue Committee, State Taxes Committee, and Administrative Review and Constitutional Law Committee, which he previously chaired. Eu-Jin’s work has been cited by the High Court of Australia, during proceedings in Parliament, by The Australian Financial Review, and by the late Justice Graham Hill. - Current at 14 February 2023
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