While a retailer’s $99.99 is a typical example of psychological pricing, the Tax Commissioner’s figure of $8,453,699.99 is not. Rather, is it the amount claimed by the Commissioner from Philip Whiteman, in on-going proceedings connected with Whiteman’s claimed involvement in unlawful phoenix activity. The Commissioner succeeded before Justice Davies in obtaining summary judgment in that 8 million dollar amount, on the basis that Whiteman had no reasonable prospects of successfully defending the Commissioner’s tax proceeding.
Those interested can read the facts and the law in the judgment of Justice Davies – Deputy Commissioner of Taxation v Whiteman  FCA 951, and her earlier related judgments DCT v A & S Services Australia Pty Ltd  FCA 437; DCT v A & S Services Australia Pty Ltd (No 2)  FCA 663.
Three interesting principles of insolvency law are highlighted.
Bankruptcy would deny Whiteman his right to challenge the tax assessments
Whiteman’s solicitor described what he seemed to assume would follow from the ATO’s inexorable pursuit of his client into bankruptcy. Any right to object to the tax assessments would become an asset of the bankruptcy for the trustee to decide whether to pursue, or not. Without funding from creditors, and the ATO would be the largest creditor, bankruptcy would stop Whiteman challenging the assessments. This would be unfair.
But the law is that a person may be made bankrupt even when they have a pending appeal from the tax debt on which the bankruptcy is based. The decision whether to pursue that tax appeal is then for their trustee in bankruptcy to decide.
That long accepted outcome of the law was the subject of a vehement criticism some twenty years ago, to no avail. Justice Hill in McCallum v Commissioner of Taxation  FCA 533, in dissenting from a majority decision, said:
The view which the majority of the Court has reached in the present case gives the Commissioner powers which are capable of abuse. It is no answer, in the remaining days of this [20th] century, to say that the Commissioner can be trusted. That is an argument which betrays a lack of realism and experience with tax administration. In so saying, I do not suggest that the present incumbent of the office of the Commissioner would in any way abuse his powers. But it is possible, as the report of the tax Ombudsman makes clear, that some officers might.
If the present judgment stands, and I can but suggest that professional bodies assist an appeal or lobby the government to change the law, the following course of action can follow in the absence of evidence of mala fides on the part of the Commissioner.
That change in the law did not ensue and cases like that of Whiteman are not uncommon.
Whiteman’s assets overseas, if any
Whiteman deposed that save for a 2003 Ford Falcon car worth about $3,000, he did not have “any assets in Australia”. Apart from Justice Davies giving this evidence “little weight, if any”, when a person goes bankrupt, the trustee in bankruptcy becomes owner of all their assets
“whether situate in Australia or elsewhere”: Bankruptcy Act, s 5(1).
As to “elsewhere”, it can then be a matter of the trustee using cross-border insolvency law remedies to recover those assets, and in practice, some countries are easier to recover assets from than others. But that is the law.
Whiteman’s claimed impecuniosity
If all that Whiteman owned in the world was his 2003 Ford, which he would be allowed to keep if he went bankrupt, a lack of assets is not a reason not to make a person bankrupt. The ultimate test of that principle was member of a religious order whose vow of poverty was no defence to their bankruptcy: Darcey v Pre-Term Foundation  FCA 165.
As an English Judge said, while there is some such defence of poverty, it must be hedged by important precautions.
“After all, if it were open to a debtor to avoid [bankruptcy] simply
by alleging utter destitution, both present and future, such pleas
of destitution might become popular; and prospective
bankrupts might hasten to rid themselves of any assets
or prospects which might hamper them in making such a
plea. A man may indeed be too poor to be made bankrupt:
but the burden of proof is heavy”: Re Field (1978) Ch 371.
In any event, in the case of Whiteman, it may be that there are other assets, beyond the Ford, and other issues, to investigate, but that is for any further proceedings to determine.