Aiding or abetting a tax offence

When can a person who has no liability to pay tax be charged with aiding, abetting or counseling commission of a tax offence? Can a tax consultant or a legal advisor who represents or acts for a taxpayer after the assessment is raised by the revenue authority be charged with aiding, abetting or counseling the commission of a tax offence?
BJ, Dar 

Section 80 of the Tax Administration Act [Cap.438 R.E 2019] creates the offence of aiding, abetting, counseling or inducing commission of a tax offence. A person convicted of aiding, abetting, counseling or inducing the commission of a tax offence is liable to a penalty equal to 100 percent of the tax shortfall. The law however does not provide how to apportion the tax shortfall where the aider and the actual perpetrator of the tax crime are jointly charged.

The Tax Administration Act does not define the words aid, abet, counsel or induce. However, in criminal law aiding, abetting, counseling or inducing the commission of an offence is way a third party to the offence is deemed to be a co-offender without necessarily doing the prohibited act or omission constituting the offence charged. Aider, abettor or counselor are treated in the same footing like the actual perpetrator of the offence charged. Aider, abettor or counselor can be charged jointly with the actual offender or alone without joining the actual perpetrator of the offence.

A tax consultant or lawyer or tax administrator who ill advises a taxpayer to do something which results in the commission of a tax offence can be charged alone or jointly with the actual perpetrator of the offence. An opinion or guidance by such a person which opinion might have multiple interpretations might not be enough to charge such a person. More importantly to charge a person as aider, abettor or counsellor, the alleged conduct amounting to aiding, abetting, counseling or inducing must have been done before the commission of the tax offence. An ill advice given by a tax consultant or lawyer after the commission of a tax offence on for example an appeal strategy filed by the taxpayer, or an objection against a tax assessment, cannot constitute aiding or abetting or counseling a taxpayer to commit a tax offence because the alleged tax offence has already been committed at the time.

Having said the above, a tax administrator can be charged as aider or abettor of a tax offence for failure to prevent the commission of the tax offence if she/he was of aware that the taxpayer wanted to commit a tax offence and the tax administrator was in a position to prevent the offence but he deliberately failed to prevent it.

It is important to note that world over consultants act for various taxpayers to reduce the impact of taxes on the taxpayer. In any transaction the consultants and the taxpayer want to ensure that they appropriately and legally plan to reduce the tax obligation. That does not amount to evasion and neither can such advice amount to aiding or abetting tax evasion. Some of the world’s biggest corporates also have legally acceptable structures to ensure that their tax obligation is reduced.