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The government’s approach towards eliminating the black economy is part of a five-year implementation plan that will require co-operation between the states and government agencies.
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Black economy measures part of the ‘long game’
08 May 2018
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7 minute read
Some of the tax-related measures, laid out in the budget in response to the Black Economy Taskforce final report, include:
- providing additional funding to the Tax Practitioners Board to take action against tax agents facilitating activity in the black economy.
- removing deductions for non-compliant payments
- changing the government’s procurement procedures to incentivise tax compliance in supply chains
- consulting on reforms to the Australian Business Number (ABN) system
- introducing an economy-wide cash payment limit for large cash transactions of $10,000 to reduce the ability of black economy operators to use cash to avoid their tax and reporting obligations and launder the proceeds of crime
- expanding the taxable payments reporting system to contractors in industries with higher identified risks of not reporting their income
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Speaking to Accountants Daily, Institute of Public Accountants general manager of technical policy, Tony Greco, said it does become a risk to introduce too many changes too soon.
“The government has decided to accept and implement a couple of them and I think we'll hear more from them in relation to the timetable,” Mr Greco said.
“Some of those measures could upset certain sectors, so maybe, being an election year, they've gone soft on some measures and tried to not implement them all in one bang.”
Mr Greco also noted that because it’s such a large inter-governmental report with many parts, some of the recommendations will take co-operation between the states and government agencies.
“It's something the government can't do on its own, and consultation has to take place to make sure that the way they implement it is feasible,” he said.
“From that perspective, it may be an appropriate approach to just take some time out and consider all those things, and that's probably going to be work of the implementation taskforce to undertake some of that work.
“It's not going to happen all at once, and it seems like the government is going to take its time.”
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