A confidential settlement also prevents the ATO from taking action against five multinational clients who supported the claims.
The Tax Office’s secret settlement with PwC in March shaved $785,400 off penalties and blocked any further action against the big four firm and its clients for making false claims of legal professional privilege over an estimated 100,000 documents.
of the deed – published as part of the Ziggy Switkowski report into the PwC tax leak scandal – reveals a string of new details about the settlement, which was signed by a senior tax officer on March 17.to prevent the Tax Practitioners Board from releasing copies of PwC internal emails that showed multiple partners, including the head of international tax, Peter Collins, leaking confidential Treasury information.
It was the initial blanket claims of LPP that led the Tax Office to request PwC internal emails that revealed the leaks of confidential information by Mr Collins and other partners.The Tax Office ruled that PwC had failed to take reasonable care in making false and misleading statements with the LPP claims, a finding that for large multinationals carries an $8400 penalty for each document.
The ATO issued penalties in respect to only 170 documents. In the settlement, the ATO dropped 17 of the penalties entirely and reduced the remaining 153 penalties by 50 per cent.In addition to the fines, PwC is required for three years to conduct staff training sessions, run a “triage and approval process” for legal services engagements, review a sample of files and appoint an independent reviewer to report on these arrangements.
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