Re: Octaviar MFS Premium Income Fund PIF
Thanks for the articles:
k.smith: "Are our custodians doing their jobs properly?"
marcom: "Freeze makes no sense, says investor"
I enjoyed reading them. Here's one in return. Hold on to your sides. Some real insight into how embarrassing our federal institutions look like when they come up against the greed they let off the leash. I hope the same doesn't happen to us.
http://www.dailytelegraph.com.au/bu.../story-e6frez7r-1225797579171?from=public_rss
"Tax office says $680m Myer haul likely lost
* By Susannah Moran
* From: The Australian
* November 14, 2009 12:01AM
The tax office is unlikely to be paid the bill without setting off on a worldwide legal chase
THE Australian Tax Office has admitted it has little hope of clawing back the $452 million Myer share sale proceeds sent offshore in the past week by global private equity company TPG.
And despite hitting the Cayman Islands-based TPG parent company with an extra $226m penalty for being involved in an alleged tax avoidance scheme, the tax office is unlikely to be paid that money either without setting off on a worldwide legal chase.
TPG says it has complied with all relevant tax laws, The Australian reports.
The tax office appears to have been stung in the past by complex overseas structures - involving ultimate parent companies located offshore that are not paying tax on Australian deals - prompting its extraordinary actions this week.
On Wednesday night, the ATO asked the Victorian Supreme Court to freeze the National Australia Bank accounts relating to the $2.4 billion float of Myer, which listed on the stockmarket last week in a blaze of publicity involving model and shareholder Jennifer Hawkins.
Two TPG companies were also banned from dealing with the Myer share sale proceeds.
The float cystalised a huge profit for TPG, which led the $1.4bn 2006 purchase of Myer from the Coles Myer group. TPG and its minority partner Blum Capital, which comprehensively restructured Myer and had already recouped their original investments in Myer, pocketed an extra $1.58bn by selling their entire stake in Myer as part of the float.
Yesterday, further details of the tax office's arguments in urgently requesting the account freeze were made public. It took the action after discovering at lunchtime on Wednesday where the money had been deposited.
Judge David Habersberger was told on Wednesday night that, while the tax office had no specific allegations to make about TPG, "in the commissioner's experience when dealing with structures such as these, one of the effects of that structure is that once funds are remitted offshore, then there is nothing in Australia which can be used to satisfy a judgment debt".
TPG's Australian office is 100 per cent-owned by the Texas-based TPG Capital, and it is believed not to have any substantial assets in Australia.
The court was told the TPG structure involved the private Myer Holdings being owned by a Netherlands-based company, in turn owned by a Luxembourg company, and then, ultimately, the Cayman Islands-based TPG Newbridge Myer. The tax office believes the scheme was set up so that the Luxembourg and Caymans Islands companies would not pay tax on the profits they made on the share sale.
The tax office's barrister, Terry Murphy SC, also said there was "virtually no hope" of being paid the $678m it has claimed - the $452m tax debt plus $226m penalty - once the money had left Australia. On Thursday, the ATO's worst nightmares were realised when it was discovered TPG Australia's account had $45 in it, with $1.5bn moved overseas in the previous 10 days. The freezing orders were lifted, and the tax office's application dismissed. "
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According to BusinessSpectator, no tax was due anyway thanks to generous laws introduced by Costella and Dutton. Doh!
http://www.businessspectator.com.au...TPG-tax-pd20091116-XU86Q?opendocument&src=rss