Recent investigations have shown that the tax system is being used as a weapon by domestic abusers.

Perpratrators have been placing tax debts onto victims, requiring the Australian Tax Office to pursue them and collect the debts from the victim.  

The Wire’s contributor Jahan Rezakhanlou asked UNSW Gendered Violence Research Network Professor Jan Breckenridge about this disturbing practice

Jahan Rezakhanlou: To talk about the issue. We welcome UNSW Gendered Violence Research networker, Professor Jan Breckenridge. Thank you for joining us, Jan.

Jan Breckenridge: Thank you Jahan.

Jahan Rezakhanlou: Could you give us a brief rundown of how domestic abusers are using the tax system as a weapon?

Jan Breckenridge: Domestic violence perpetrators have weaponized different systems, whether it be the financial sector and their banking with abusive transactions or inherited debt. But it’s only recently that we’ve become aware that they have incurred enormous tax debts that then get transferred to their partner by way of Centrelink or company directorship arrangements that are made, often without their partner knowing the implications.

Jahan Rezakhanlou: Is this a recent phenomenon or has it been a long-term thing?

Jan Breckenridge: Most people, including researchers, have really focused more on domestic and family violence that is physical in nature. I think increasingly we’ve become aware that there’s coercive control, there’s psychological and emotional abuse, and more recently, financial and economic abuse. And what financial and economic abuse means is that someone who’s in that relationship can’t leave. They’re either going to move to poverty or insecure housing, and it can be very difficult if they’re in prolonged family court actions. It’s not a new thing. It’s been going on probably as long as physical abuse has been going on. But our awareness as researchers and probably as practitioners, it’s more recent than that. And certainly in the area of taxation that is probably original research in Australia and America is the other country who have been looking at this.

Jahan Rezakhanlou: Is it found internationally beyond America?

Jan Breckenridge: I would imagine that there are always all of these tactics and strategies that are used by people who are abusive within their relationships, it’s ubiquitous. It will happen everywhere, but it can be very specific to a different country, their particular legislation and policies. So the actual weaponization may be different, but the process is pretty much the same.

Jahan Rezakhanlou: What other specific tactics that abusers are using?

Jan Breckenridge: Well, women can be made responsible for their partner’s business debts. They can be made responsible for the company’s bankruptcy. And when they’re declared bankrupt, it means they have no standing in family court for a property settlement. Corporate directorship and director penalty notices have really severe ramifications, and it can leave people unknowingly with debilitating financial burdens. And what it means is people can’t leave. Or if they do leave their impoverished, they have prolonged periods of economic instability. Housing is usually affected, and this is often why people don’t leave domestic and family violence relationships because it’s very difficult to do so. And often it can mean that there’s an effect on whether they can have their children with them or manage financially to care for their children after these deaths. And, you know, we’re looking at people who might have, you know, sexually transmitted tax debts. The average amount is $90,000. Now, that’s an enormous amount of money to be trying to cover, particularly where you have been made a dummy director and you have no other income.

Jahan Rezakhanlou: What do you think the Australian Tax Office or indeed the federal government could do against this practice?

Jan Breckenridge: I think if we’re serious, we’ve got to modernize our tax system to actually identify domestic and family violence and to support victims and survivors who have precarious financial situations, because when we know that we still are holding people accountable for their debt. Now, the Assistant Minister for the Prevention of Family Violence and for Social Services, Justine Elliott, has asked the government to switch the debt to the person responsible for creating it, which is, I think, one of the first steps the people who create the debt should be held responsible. But it’s also quite tricky because a lot of economic and financial abuse is not criminal in nature, and it’s not even illegal, but it can be around a partner being coerced into signing documents or unknowingly signing documents that have tremendous ramifications for them. So it takes a much greater approach around the education of taxation, people working in taxation, government and of people, people themselves. Because you ask most people, tax is something that’s scary. Tax is something they get experts to help them with, and they may not even be aware that what help is available through the tax clinic at UNSW, which is a free tax clinic, and there are some throughout New South Wales or other potential areas of assistance through financial institutions and their hardship teams.

Jahan Rezakhanlou: So do you have any particular advice for domestic abuse survivors who are suffering from this issue?

Jan Breckenridge: I think that there are some excellent financial advisers and free services available that access. Go and ask the questions if you’re not sure. Get people to help you because there is help available and very often people are missing out on help that would make. A huge difference to their lives and would help maybe prevent and remedy some of the debts that they’ve inherited.

Jahan Rezakhanlou: Do you have any recommendations for services that people may call?

Jan Breckenridge: I think if you’re feeling concerned about hearing of anything with this story, if it stays with you for a couple of days, certainly ring organizations like 1800 respect lifeline or 1300 yarn, they’re all organizations that can help. Just discuss some issues and help you sort through what might be troubling you.