27 September 2023

ATO cashes in on tax ‘dobbers’

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Credit: Kritchanut

The Australian Taxation Office (ATO) has reported that the number of people ‘dobbing in’ their fellow citizens for evading tax obligations has almost doubled in the past financial year.

According to Assistant Taxation Commissioner Peter Holt there were nearly 60,000 reports of suspected tax evasion, the black economy or illegal phoenix activity received by the ATO between 1 July 2018 and 31 May this year.

Mr Holt said this was a 42 per cent increase on the volume of referrals received in the same time period in the previous financial year.

He said that while not all referrals resulted in a full blown tax audit, they helped build a more complete view of risk and assisted the ATO in deciding whether further action was required.

He said more than half of all referrals were for suspected under-reporting of income or about the cash economy which saw businesses demanding cash from customers or paying their workers cash in hand.

“We’re seeing an upwards trend in the volume of referrals about people suspected of participating in the black economy, which suggests that honest businesses have had enough of competitors cheating the system and getting an unfair advantage,” Mr Holt said.

“Going on current numbers, we’re on track to receive over 70,000 community referrals before the end of this financial year.”

He said that by way of comparison, the ATO received more than 51,000 referrals in 2017-18 and that was the highest ever number of referrals received.

“The record number of referrals coincides with improvements to the process for letting the ATO know about suspected tax evasion,” Mr Holt said.

“The new and improved Tax Integrity Centre will be launching on 1 July, and will provide a single point of contact for reporting suspected or known illegal phoenix, tax evasion, and black economy activity.”

He said it would be the taxation equivalent of Crime Stoppers for tax.

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