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Australia Consults On Black Economy Measures

by Mary Swire, Tax-News.com, Hong Kong

24 October 2017


The Australian Government is consulting on two measures designed to crack down on problems associated with the "black economy."

The measures, announced at the 2017-18 Budget, are included in draft legislation released by the Government on October 23.

The Government intends to ban the manufacture, possession, use, or sale of sales suppression technology, which allows businesses to understate their income.

It will become an offense to produce or supply an electronic sales suppression tool, the penalty for which will be five years' imprisonment and/or a fine. It will likewise be an offense for entities that are required to keep or make records under Australian tax law to possess an electronic sales suppression tool, or to use such technology to incorrectly make or keep such records.

The legislation also makes provision for the extension of the Taxable Payment Reporting system (TPRS) to two industries identified as high-risk: cleaning and couriers. The aim is to ensure that payments made to contractors in these sectors are reported to the Australian Taxation Office (ATO).

The TPRS currently requires businesses in the building and construction industry to report payments they make to contractors to the ATO.

The black economy in Australia is thought to be as large as 1.5 percent of the country's GDP, or around AUD25bn (USD19.5bn).

The consultation closes on 10 November.

TAGS: compliance | tax | business | sales tax | tax compliance | tax avoidance | law | goods and services tax (GST) | Australia | tax authority | contractors | legislation | tax reform | construction | services

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