ATO tells court the amount of money transferred offshore by the Chinese billionaire has risen dramatically since an audit began

The controversial political donor Huang Xiangmo has pulled nearly $50m out of Australia since his permanent residency was cancelled in December, as the Australian tax office chases him over a $140m tax bill.

The tax office has won an order in the federal court against the Chinese billionaire and his wife, freezing Huang’s assets in Australia and overseas, with the tax office arguing he does not have enough assets in Australia to pay the money he owes.

More details of Huang’s tax affairs may be released by the court in coming days unless the billionaire, currently believed to be residing in Hong Kong, successfully applies for a suppression order. Justice Anna Katzmann told the court there was “plainly a public interest” in the disclosure of detailed submissions from the tax office laying out its investigation into Huang’s affairs.

Political donor Huang Xiangmo blocked from returning to Australia Read more

Court documents released on Wednesday show the tax office undertook a risk review – later upgraded to an audit – of Huang’s finances for the financial years 2013 to 2015. The ATO audit found he understated his income by millions of dollars each year, resulting in a tax bill that peaked at $57.8m in 2014, when his estimated income was more than $100m.

He was left with a tax liability of $80m, swollen to $140m by interest and penalties.

Katzmann said that although there was no direct evidence that Huang “intended to divest himself of his Australian assets or diminish them in value, the results of the audit indicate an intention to avoid paying tax by grossly understating income”.

She said the flow of money back and forth between China and Australia showed Huang was “likely to be a person of substantial wealth” but he did not appear to have enough assets in Australia to pay the ATO bill.

“These circumstances demonstrate that Mr Huang has both a motive and the means to dissipate his Australian assets.

Huang Xiangmo. Photograph: Yuhu

“Although he transferred money overseas before he was aware that he was under investigation by the ATO, since the audit began the amount of money transferred offshore increased dramatically,” Katzmann said.

“The amount of money transferred out of Australia since December 2018 exceeds the amount coming in by $46,749,253, nearly twice as much as the previous year.”

Assets frozen by Katzmann include a $12.8m mansion in the Sydney harbourside suburb of Mosman, which is registered in the name of Huang’s wife.

After examining bank records, the judge said the pile was “likely to be an asset of both Mr Huang and his wife”. The tax office argued Jiefang Huang, who gave her profession as “housewife”, could not pay $12m to buy the mansion outright, and that Huang was the “most likely source of funds”.

Katzmann found the tax office “without doubt … had a good arguable case” that it was entitled to recover the $140m bill.

NSW Labor forfeits $100,000 allegedly donated by Chinese billionaire in Aldi shopping bag Read more

Huang, a Chinese billionaire property developer who arrived in Australia in 2011, assiduously cultivated influence with both sides of Australian politics during this time in the country, donating $2.7m to both the Liberal and Labor parties and appearing in photographs with prime ministers and ministers. The Labor senator Sam Dastyari was forced to resign from parliament after revelations he had asked Huang for money to pay personal legal bills and warned Huang he was under surveillance.

Huang’s permanent residency visa was summarily cancelled – and his application for Australian citizenship withdrawn – by the Morrison government last December on character grounds, and after Asio warned political parties against accepting any more money from Huang. Of particular concern was his long-running involvement with the Australian Council for the Promotion of the Peaceful Reunification of China, which has been accused of being a front for Chinese government efforts to expand its global influence.

Despite his exile from Australia, Huang has re-emerged as a key figure in the Independent Commission Against Corruption’s current investigation into Labor party donations this month.

Icac has heard allegations that Huang gave the New South Wales branch of the ALP $100,000 – personally delivered in cash in an Aldi shopping bag – in breach of electoral regulations which prohibit property developers donating.

From Hong Kong, Huang has denied being the source of the money but has refused to give evidence to Icac.