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Auckland businessmen sentenced for tax evasion

Three Auckland businessmen, including a former Dragon’s Den TV star, have been jailed or ordered to serve home detention for tax evasion.

Former Ernst and Young tax partner David Tauber, former television celebrity Paul Webb and a businessman known only as Mr X, because his name is suppressed, were sentenced at the High Court in Auckland yesterday.

Tauber was sent to jail for three years and three months. Webb and Mr X will serve 9 months and 12 months of home detention respectively, plus both will complete 400 hours community work.

Their now defunct companies, Honk Barges and Honk Marine Limited were fined $125,000 and $100,000 respectively.

Inland Revenue spokesperson Karen Whitiskie says the offenders were found guilty and convicted in July on 36 charges of tax evasion, spanning five years. The offending involved a quantum of tax intended to be evaded of $2,222,044.72.

“The sentences are a warning that people operating illegal evasion schemes will face serious consequences.

"Inland Revenue is using increasingly sophisticated methods to detect tax evasion and fraud schemes, and will take action against serious non-compliance, no matter how long it takes.

“This was a complicated, long-running investigation involving more than 10,000 hours of Inland Revenue time.”

Karen Whitiskie says each of the three defendants had a hand in artificially inflating the cost of barges and a dredging platform so the companies could claim increased depreciation and interest deductions and pay less tax.

“This is not using the law to your advantage – it’s tax evasion and now these men will face the consequences.”