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Promoter penalties

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Published on 01 Feb 22 by "THE TAX SPECIALIST" JOURNAL ARTICLE

It has been 15 years since the introduction of the promoter penalty regime (PPR). Although there have only been a few notable cases before the courts, the focus and ambit of the regime has become clearer, and the courts have handed down significant penalties that reflect both the need to protect taxpayers and the community’s attitude against such egregious activity. The PPR has become another weapon in the Commissioner’s armoury for effecting change in attitudes and behaviour in the tax advisory landscape. Therefore, tax advisers now need to be aware about how their conduct may constitute a tax exploitation scheme, but more importantly, how such a scheme might be promoted. In this article, the author considers recent cases, including FCT v Bogiatto and FCT v Rowntree, and argues that what might seemingly be normal commercial behaviour between a tax adviser and a taxpayer can inadvertently transpose into prohibited conduct with the prospect of prosecution and substantial civil penalties.
The author also considers the court’s approach to assessing penalties and whether imprisonment could ultimately occur as a consequence of a promoter’s conviction, and suggests that such an outcome is open to the court.

Author profile

Arthur Athanasiou CTA-Life
Photo of author, Arthur ATHANASIOU Arthur Athanasiou, CTA (Life), is an Accredited Tax Law Specialist and Principal of AGA Legal Pty Ltd. He is a highly competent and well-respected tax lawyer with 30 years’ experience. While he provides clients with tax and structuring advice, his main area of focus is in resolving tax disputes with the ATO and SRO and settling tax audits. Arthur also practises in matters involving tax agents and inquiries by the Tax Practitioners Board including appealing adverse TPB decisions. His practice also extends to white-collar crime, and other taxation offences. He also has a Deceased Estates practice. Arthur has qualified as a Chartered Accountant and is a former President of The Tax Institute. He has been appointed as an Adjunct Professor at La Trobe University Law School and chaired the Law Institute’s Tax Law Advisory Committee for a decade. Arthur has been recognized by Doyle's Guide who has recognized him as a "Leading Lawyer, Tax Law, Victoria" multiple times (2016, 2018-2024) and a "Recommended Lawyer, Tax Law, Victoria" (2015, 2017). Best Lawyers Peer Review recognised him as "Best Lawyer Trusts and Estates" (2022-2026) and for his work in Tax Law (since 2023). He is a widely published writer on taxation issues and regularly appears in mainstream media and presents at tax conferences and seminars. - Current at 03 June 2025
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