Invitation to comment
Implementing a reporting regime for sharing economy platform providers
In the 2018-19 Budget, the Government announced that it will consult stakeholders on how it could implement the Black Economy Taskforce recommendation for a sharing economy reporting regime. The Taskforce recommended that sharing economy websites should be required to report payments made to their users to the ATO and other government agencies as appropriate (see Final Report).
The consultation paper discusses existing arrangements for reporting sharing economy information and seeks views on the possible design characteristics of a reporting regime, including the scope of proposed information reporting requirements.
Improving Black Economy Enforcement and Offences
In the 2018-19 Budget, the Government announced that it will conduct a review of existing criminal offences, and civil and administrative penalties for black economy activity. As part of this process, the Government is consulting stakeholders on how it could implement the Black Economy Taskforce recommendation to introduce a modern offences regime to tackle the black economy.
This consultation discusses how a targeted, stronger and more visible approach to enforcement can be implemented to target black economy activities. Views are sought on a number of proposed amendments to black economy offences, penalties and streamlining prosecution processes.
2018-19 Budget Black Economy Measure – Increasing the integrity of Government procurement
The Government has released for public consultation draft procurement connected policy (PCP) guidelines to implement a recommendation of the Black Economy Taskforce to require businesses seeking to tender for Australian Government procurement contracts over $4 million (inclusive of GST) to provide a statement of tax record from the Australian Taxation Office that indicates that they are generally compliant with their tax obligations. The draft PCP sets out the key components that are aimed at improving the integrity of the procurement process and provides guidance to assist all relevant Commonwealth entities in implementing the policy.
2018-19 Budget Black Economy Measure – Further expansion of the taxable payment reporting system
The Government has released for public consultation exposure draft legislation and explanatory memorandum to further expand the taxable payment reporting system (TPRS) to three new industries: 'road freight', 'information technology', or 'security, investigation or surveillance', to ensure payments made to contractors in these industries are reported to the Australian Taxation Office (ATO).
The ATO will release a draft determination and guidance material that will provide further detail on the operation of the TPRS measure. The information on the TPRS obligations and reporting requirements that currently apply to the building and construction industry is available on the ATO website. As this information only applies to the building and construction industry it is indicative only, of similar obligations which would apply to the three new industries.
2018-19 Budget Black Economy Measure- Removing tax deductibility of certain payments
The Government has released for public consultation exposure draft legislation and explanatory memorandum to remove tax deductibility of certain payments – including payment of wages and payments to contractors – if the entity making the payment fails to comply with its obligations to withhold and report information to the Commissioner of Taxation.
Designing a modern Australian Business Number system
In the 2018-19 Budget, the Government announced that it will consult stakeholders on the best way to strengthen and modernise the Australian Business Number (ABN) system. Action to reform the ABN system responds to Black Economy Taskforce findings (see Final Report) that participants in the black economy are using the ABN system to facilitate their fraudulent activity. This will also provide an opportunity to consider improvements to the ABN system which will better support ABN data for end users and underpin the growing use of ABNs across a wide range of purposes.
This consultation paper seeks stakeholder views on designing a modern ABN system, noting that this is occurring alongside a suite of related Government reforms to modernise business registers, implement a digital identity framework, introduce director identification numbers, and reduce phoenixing activity.
Introducing an economy wide cash payment limit
In the 2018-19 Budget, the Government responded to the Black Economy Taskforce's Final Report. This included the announcement of an economy-wide cash payment limit of $10,000 for payments to businesses for goods and services, to apply from 1 July 2019. Transactions in excess of this amount would need to be made using the electronic payment system or by cheque. The Government is seeking to strike the right balance between cracking down on black economy participants using large cash transactions to avoid their tax obligations, and ensuring that businesses doing the right thing are not unduly burdened by increased red tape.
Government procurement
In the 2018-19 Budget, the Government responded to the Black Economy Taskforce's Final Report. This included an announcement that the Government would require businesses seeking to tender for Australian Government procurement contracts over $4 million (inclusive of GST) to provide a statement from the ATO indicating that they are generally compliant with their tax obligations. Businesses who do not meet their tax obligations have an unfair advantage over honest businesses that do. The government wants to lead by example by implementing this recommendation in a way that strikes the right balance between tackling the black economy and keeping the regulatory requirements as low as possible.
Consultation paper
Following the release of the Interim Report the Taskforce sought public comments on a consultation paper outlining a number of additional policy ideas based on public and stakeholder consultations. The 54 ideas outlined in the Taskforce's paper were not recommendations, but intended for public comment and reaction.
This process is now closed.