ATO invites black economy tip-offs in effort to curb wrongdoing

The ATO’s Tax Integrity Centre received over 27,000 tip-offs in the first half of this financial year, after gathering a record-breaking 15,000 tip-offs in the first quarter.

The top tip-off categories have been not declaring income; demanding cash from customers; someone’s lifestyle does not appear to match their income level; not reporting sales; and employers avoiding reporting correct wages, the Tax Office revealed.

“Tip-offs are a vital source of information when we need to investigate someone who is illegally operating in the black economy,” the ATO said.

“If you know or suspect a business is taking part in phoenix, tax evasion or black economy activities, you can make a tip-off by using our online form, phoning the Black Economy Hotline on 1800 060 062.”

The office warned that businesses that deliberately do the wrong thing put others at an unfair disadvantage.

“Everyone should play fair and meet their tax and super obligations.” 

At the end of the first quarter of the 2019–20 financial year, the ATO revealed that there is a black economy problem in the café and restaurant industry. 

“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,” assistant commissioner Peter Holt said at the time. 

“Regardless of what industry you’re in, if you’re cooking the books, your competitors and workers are probably aware of it. And they’re not hesitating to let us know about it.”

The ATO has a specialist team that looks at each and every tip-off, regardless of whether they are received anonymously or not.

The Black Economy Taskforce estimates that the black economy is costing the community as much as $50 billion each year, which is approximately 3 per cent of gross domestic product (GDP).