We reject the legal status quo which enables garnishee orders issued prior to bankruptcy to continue to
garnish the wages of bankrupted individuals post-bankruptcy. As we understand it, garnishee orders issued by the ATO are considered to be a statutory charge, and therefore will continue to operate post-bankruptcy if issued prior to bankruptcy.
We have read and considered the common law basis for this legal position as
articulated in the Commissioner of Taxation v Donnelly2 and Macquarie Health Corporation Ltd v FCT3.
We also reject the legal status quo that permits the ATO to issue garnishee orders in exercise of its
administrative powers, absent a court hearing, pursuant to subsection 260-5(2) of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA).
We further reject the inflated limit for ATO garnishee orders which is 30% of income, compared with 20% for the private sector.190621 Submission IGT Garnishee Review