- The ATO has received a record 15,000 tip offs, as Australians dob in businesses suspected of dodgy behaviour.
- The main habits being dobbed in are underreporting sales and income, and paying in and demanding cash to distort tax payments. Australians are also suspicious of anyone seen living above their means, suspecting illegitimate activity.
- The ATO has released the figures as it announces its plans to visit 10,000 businesses this year as a result, starting with 400 in Bankstown next month.
Australians are snitching on an unprecedented scale, but it’s not the neighbour’s hydroponic set up that’s raising our hackles.
It’s the cash economy, stupid, and it’s got us frantically dialling the Australian Taxation Office (ATO) 230 times every damn day to report shonky businesses.
“We’re hearing loud and clear that people are sick and tired of this kind of dodgy behaviour,” ATO assistant commissioner Peter Holt said in a note issued to Business Insider Australia. “Running a small business can be a really tough gig, and when dishonest competitors are cheating the tax system by operating off the books, it’s really unfair and makes it even harder to succeed. It’s also effectively stealing from the community.”
It makes for a record-breaking 15,000 complaints in the last three months to the fearsomely-named ‘Tax Integrity Centre’. The main transgressions drawing the community’s ire include not declaring income and sales, demanding cash payments from customers, paying workers in cash, and when someone’s lifestyle exceeds their income level – the calling card of white-collar crime.
Red flags like these have helped spur the ATO in action, as it launches investigations into the ‘black economy’ which costs the country some $50 billion a year. No prizes though for guessing who are the worst offenders when it comes to cooking the books.
“The proof is in the pudding. Our risk indicators tell us that there is a black economy problem in the café and restaurant industry and the fact that tip-offs about this industry top our list tells us that there is still more work to be done to protect honest café and restaurant owners and workers in this industry,” Holt said.
“The hospitality industry employs more than 800,000 people and these workers all deserve to be paid their full entitlements.”
Holt reasons that the sector’s low-profit margins are the main motivation to rort the tax system, but warns that the more cash a business uses the more mistakes, deliberate or not, it makes.
“Trading in cash and paying your workers in cash is perfectly legal but failing to report the income to the ATO and not paying your workers their entitlements like superannuation is not only illegal but also incredibly unfair,” he said.
The ATO plans to visit 10,000 businesses this year as part of its investigations, and already has a blitz scheduled on the Sydney suburb of Bankstown for November, after a spike in complaints in the area.
“There are significant numbers of businesses in Bankstown with more than two years of overdue income tax returns as well as large numbers of business activity statements outstanding, which is a concern to us,” the ATO warned last week.
You can tip off the ATO here.