PwC Australia ties Google to tax leak scandal, sources say

This is the first time a company has been directly linked to the national scandal involving the “big four” accounting firm that was first revealed in January.

PwC is facing scrutiny because several years ago a former partner, Peter Collins, who advised the Australian government on anti-tax avoidance laws shared confidential drafts with colleagues about the government’s plans that were then used to drum up business with multinational companies.

In August 2015, one of Collins’ colleagues emailed a Google employee to confirm the likely start date for the government’s Multinational Anti-Avoidance Law (MAAL), according to one of the sources.

While the Jan. 1, 2016 start date for the law had been announced in the government’s budget papers in May 2015, the confirmation that the government would go ahead with that date came from confidential government briefings, the source said.

At the time, a number of organisations had called for the government to delay the planned January 2016 start date.

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The former partner did not tell Google the information was confidential, the source said. The sources asked not to be named as the information has not been authorised for public release.

PwC has not publicly identified any client in relation to the scandal, which was sparked by Collins breaching confidentiality agreements signed with the government between 2013 and 2018.

Reuters could not establish if Google was a client of PwC Australia at the time and if it used the information in any way.

“While it is disappointing to learn that PwC had inappropriately shared information, it had no bearing on our compliance with the Multinational Anti-Avoidance Law,” a Google spokesperson said in a statement. “The changes we made to our tax structure in Australia were done both after the new law was passed and after engaging directly with the Australian Tax Office.”

PwC Australia responded to a request for comment on this story and several questions about its relationship to Google by saying its clients “were not involved in any wrongdoing and no confidential information was used to enable clients to pay less tax”.

Collins could not be reached for comment.

First revealed by tax authorities in January, the scandal has forced out PwC Australia’s Chief Executive Tom Seymour, cost it at least five high-profile clients and triggered the sale of its lucrative government consulting wing for A$1 ($0.66).

After receiving a 144-page cache of PwC emails released by the Tax Practitioners Board, lawmakers investigating the scandal asked PwC to list companies given confidential Australian Taxation Office information about the anti-avoidance law.

PwC sent a written response in June. What sources told Reuters matches information in the letter, which was publicly released with the name of the company that received the confidential information redacted.

Tax officials told parliament in May they foiled several attempts by unnamed multinational firms to subvert the multinational anti-avoidance law in early 2016, months after confidential information had leaked.