Moving quickly on the issue of TPG allegedly using a firm in Cayman Islands to avoid paying the due tax, the Australian Tax Office has slapped the private equity firm with a $678 Million tax bill.  It has been stated that TPG misused the country's tax haven which was introduced in 2006 as the Tax Laws Amendment Bill and made "capital gains tax optional for foreign entities investing in Australia, other than in real estate".

The aim of the Bill was to establish "Australia's status as an attractive place for business and investment" as well as improving "the integrity of the capital gains tax base". But it seems that many firms are now misusing the liberty, as seems to be the case with TPG.

It has been revealed that the ATO tax haven booklet, which was updated in June, has specifically warned firms against about using it in private equity deals like the TPG-Myer deal in question. "The use of tax havens in some large private equity deals may require monitoring of the payments made to general partners of the equity investing vehicles to determine, among other things, whether some part of the profit is properly attributable to Australian enterprises", the ATO said.

ATO has, in addition to sending a huge tax bill to TPG firms in Luxembourg and Cayman Islands, is demanding a court action and freezing the $1.5 Billion which was earned by the private equity firm as a result of the Myer public offering.