Billabong founder wins right to fight ATO in High Court
Gordon Merchant is also suing consulting giant EY over tax advice that landed him with a $50 million bill.
The founder of surfwear company Billabong, Gordon Merchant, will continue his five-year battle with the Tax Office in the High Court, after he was granted leave to appeal a ruling that left him with a $50 million tax bill.
The court announced on Thursday that Merchant could challenge a 2-1 decision of the Full Federal Court that his attempt to minimise tax on the 2015 sale of his plastics business — Plantic Technologies — was an illegal tax avoidance scheme.
Merchant acted on the advice of EY and is suing the consulting giant and former partner Ian Burgess in the Supreme Court of Queensland, but that case has been put on hold until his action against the ATO is over.
The High Court also granted the ATO leave to appeal aspects of the decision, such as the application of the “dominant purpose” test for dividend stripping.
