may 2018 - department of the treasury · those doing the right thing. these people bear the cost of...

Tackling the black economy Government Response to the Black Economy Taskforce Final Report

Tackling the black economy Government Response to the Black Economy Taskforce Final Report

May 2018

ii

© Commonwealth of Australia 2018

ISBN: 978-1-925504-84-2

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iii

Contents Contents ...................................................................................................................................... iii

Foreword ......................................................................................................................................1

Government Response to the Black Economy Taskforce Final Report ..............................................3 The need for action .................................................................................................................................. 3 What the Government is doing ................................................................................................................ 4 Strengthening business identity verification ............................................................................................ 6 Bolstering reporting architecture to support up-to-date information .................................................... 7 Encouraging the transition to a digital society ......................................................................................... 8 Levelling the playing field ......................................................................................................................... 9 More transparent and targeted enforcement and prosecution ............................................................10 Disrupting illegal activity ........................................................................................................................11

Detailed Government Response to the recommendations of the Taskforce Final Report ............... 13 Government response to supplementary recommendations ...............................................................40

Foreword

1

Foreword

I am pleased to release the Australian Government’s response to the Black Economy Taskforce Final Report.

Drawing on the comprehensive work of the Taskforce, led by Mr Michael Andrew AO, this response provides the first whole-of-government blueprint for tackling the black economy. I wish to thank Mr Andrew and his team for producing this Report. I also wish to thank the hundreds of people, businesses and associations who contributed to the many meetings and roundtables held by the Taskforce.

The Government established the Black Economy Taskforce in December 2016 following an initial investigation by the Board of Tax which showed that a concerted effort was needed to halt or reverse growth in the black economy.

The Taskforce report illustrated the complexity of the problem, with 80 recommendations (including supplementary recommendations) spanning the whole economy.

It highlighted how the black economy is harming those less able to protect themselves and penalising those doing the right thing. These people bear the cost of the individuals and businesses dishonestly participating in the black economy. While the financial costs for businesses and individuals are significant, it is the societal costs that really bite. The black economy undermines trust and creates an uneven playing field.

This Government response aims to target the black economy in its many forms. Action will benefit the economy, community, business and all levels of government. But business as usual approaches will not work. The Government response takes a smarter approach by addressing the underlying causes of the black economy to better target those doing the wrong thing while reducing the compliance burden for those doing the right thing.

I am confident that this multi-pronged approach will deliver results for all Australians.

The Hon. Kelly O’Dwyer MP

Minister for Revenue and Financial Services

Minister for Women

Minister Assisting the Prime Minister for the Public Service

Government Response to the Black Economy Taskforce Final Report

3


The need for action

The Interim and Final Reports of the Black Economy Taskforce have built a compelling case for the Government to take action.

The Taskforce estimates that the black economy could have doubled since 2012 to now represent up to $50 billion in 2015-16 dollars. This is disturbing. The black economy results in a loss of revenue, which could be used to provide better services to the community and lower taxes. This penalises honest Australians who meet their tax and other regulatory obligations.

Even more disturbing are the Taskforce’s findings on the harm the black economy is causing individuals and businesses.

The black economy creates an uneven playing field for business. Operating in the black economy gives an unfair competitive advantage to unscrupulous businesses that are able to undercut competitors by not following the rules. This puts pressure on the margins of honest businesses and affects their profitability – a direct burden on their livelihood.

This in turn can encourage other businesses to begin operating in the black economy to stay competitive, with flow on effects for those who deal with these businesses. The exploitation of vulnerable employees through the underpayment of wages and loss of entitlements is another part of the black economy which is of concern to the Government.

The Taskforce Report highlights that the black economy is growing and if not dealt with effectively, could develop a dangerous momentum which is already being seen in particular parts of the economy. In recent years, changes in technology have supported the rise of the sharing economy and the gig economy, while wage growth and corporate profits have been subdued. Combined with social shifts, this has tended to normalise black economy behaviour such as not disclosing income.

These factors, and others, have driven growth in the black economy and provided incentives and new opportunities to engage in fraudulent behaviour.

The black economy is not limited to tax fraud. Rather, it is a complex, multi-faceted phenomenon operating across Australia’s workplace relations, financial, welfare, procurement and migration systems. See Box 1 for examples of black economy activity.

Box 1: Understanding the black economy

There is no internationally agreed definition of the black economy but it generally refers to activities which take place outside the tax and regulatory systems such as:

• Demanding or paying for work cash in hand to avoid obligations

• Not reporting or under-reporting income

• Underpayment of wages • Sham contracting – presenting an

employment relationship as a contracting arrangement

• Illegal phoenixing – liquidating and re-forming a business to avoid obligations

• Bypassing visa restrictions and visa fraud

• Identity fraud • ABN, GST, and duty fraud • Excise evasion • Money laundering • Unregulated gambling • Counterfeit goods • Illegal drugs • Illicit tobacco and illegal gambling

Tackling the black economy

4

The black economy is also a source of funds for criminal behaviour, providing a facilitating role by creating a ready source of cash that can be funnelled into illegal activity. The black economy is ever changing and will require ongoing action to effectively combat its growth.

What the Government is doing

In recognition of the need for urgent action, the Government responded to the Interim Report by announcing three measures in the 2017-18 Budget. These measures banned electronic sales suppression tools which enable businesses to ‘hide’ transactions, tackled tax evasion in high risk industries through a requirement that businesses report payments to contractors in the courier and cleaning industries, and extended ATO audit and compliance programs for a year to better target black economy risks while the Taskforce finalised its findings.

The Government agrees with the Taskforce that a new approach is needed to this complex problem. Successfully combatting the black economy requires an approach which brings together the multiple arms of government across Australia and leverages private sector expertise. The black economy operates across borders and state jurisdictions, moving interstate or overseas to avoid regulatory action by government and law enforcement agencies. Government action must be more coordinated and more agile in response.

Through this response, the Government is undertaking the first broad-spectrum initiative to address this pervasive and opaque part of the economy. The Government recognises that this is not a problem that can be fixed with piecemeal action but which requires a comprehensive set of initiatives to address the varied elements of the black economy and the underlying drivers of behaviour.

In 2017-18 alone, the Government has taken action on a number of fronts.

The Government introduced strong new penalties that apply to employers who dodge their obligation to pay superannuation guarantee for their employees and legislated against GST fraud in both the precious metals industry and the new residential premises construction sector.

We have announced tough new laws to address illegal phoenixing, worked with States and Territories to combat illegal gambling, progressed a digital identity solution to prevent black economy behaviour before it occurs, continued to address the exploitation of migrant workers through a dedicated taskforce, and put in place higher penalties for those who contravene workplace laws.

The Government response recognises that continued action is needed to halt or reverse growth in the black economy. As part of a long term reform program, the Government has announced in the 2018-19 Budget that it will:

• strengthen business identity verification;

• bolster reporting architecture;

• encourage the transition to a digital society;

• level the playing field for business;

• deliver a more targeted, stronger and more visible approach to enforcement; and

• disrupt illegal activity.

A number of longer term measures will also be implemented progressively over the coming years.

The Government understands that combatting the black economy must be done in concert with the wider community. The need for action is clear but further consultation will be undertaken on these


5

longer term measures to determine the best way of implementing them. This includes responding to the Taskforce recommendations to pay wages into bank accounts, consideration of further reporting processes for the gig economy and national standards for procurement.

In implementing these recommendations, the Government recognises that most people and businesses in our community are doing the right thing. Action on the black economy therefore must avoid imposing more regulation on businesses unless it is necessary. The Government will seek to use smart technology wherever possible to address the underlying causes of the black economy and target those doing the wrong thing. Education will also form an important part of the Government’s approach to discourage participation in the black economy. Early intervention through targeted tax literacy programs can help businesses get it right from the start.

The Government response provides a significant opportunity to change attitudes within the community. Decisive action across the black economy sends a clear message that participation in the black economy is not acceptable. It is hurting ordinary Australians and must stop. Greater resourcing and clever use of data will greatly increase the chances of those who engage in the black economy being caught.


6

Strengthening business identity verification

Faster, more accurate identification of business is at the core of the Government’s new approach. Better identity verification offers the opportunity to prevent black economy behaviour before it occurs. Being assured that who you are dealing with is legitimate is the cornerstone of most business-to-business interactions.

Our identity verification systems are in need of reform to ensure that they keep pace with technological changes. The Government has commenced reforms that will examine how to best overhaul the multiple business registers across government. Some of these registers still rely on paper-based forms, involve manual processing and are not adequately linked to enable the identification of fraudulent behaviour. The aim is to create a modern, streamlined approach to business registration.

Streamlining and modernising the current register system will offer benefits to business and government and will make it easier to identify businesses that are creating multiple entities or hiding behind fraudulent credentials to avoid their obligations.

These reforms will be complemented by reforms to the Australian Business Number (ABN) system. The current ABN system was introduced in 2000 mainly as a business identifier and to support the implementation of the GST. There have not been any significant changes since this time despite the fact that the ABN system is now used by businesses, the community and governments for a range of purposes and needs to be reliable. ABN data is increasingly being used for purposes outside the tax system including infrastructure planning, program implementation, disaster management, policy design and regulatory compliance.

Consultation will be undertaken on a new ABN framework, including the potential introduction of an ABN renewal scheme.

New requirements for company directors to hold a unique Director Identification Number will work hand-in-hand with these reforms to provide better data on who owns and controls businesses. This will be a key step in combatting illegal phoenixing.

Box 2: The cost of crime The annual cost of identity crime in Australia is estimated to be $2.2 billion. In 2014-15

alone, there were close to 100,000 incidents of identity fraud identified by Australian Government agencies.

Identity crime is a key enabler of serious and organised criminal activities, which have been estimated to cost Australia at least $36 billion annually.

ABN reforms are at the heart of improving business identity – they will create a more accurate record of the over 7 million entities with active ABNs. This will ensure that the millions of users of ABN data can be assured that it is accurate and up-to-date. In 2016-17, 770 million searches of ABN data were initiated through the ABN Look-up service.

Personal identity reforms will complement ABN and other business reforms discussed above. The Government’s Digital Transformation Agency is progressing a new system of digital credentials – Govpass – which will make proving your identity in order to access government services simpler, safer and more secure.


7

Bolstering reporting architecture to support up-to-date information

The bedrock of any system must be reporting arrangements. Just like our systems for identity verification, reporting systems must also change to reflect the new economy where self-employment, contracting and labour hire firms are increasingly part of the labour mix.

In recognition of this, the Government is expanding the contractor payment reporting system – the taxable payments reporting system (TPRS). In the 2017-18 Budget, in response to the Taskforce’s Interim Report, the Government announced the expansion of the TPRS to the courier and cleaning industry.

As part of this response, the TPRS will be further expanded from 1 July 2019 to three new industries. Security providers and investigative services, road freight transport, and computer system design and related services have all been identified as industries where contractors are at higher risk of either not reporting or under-reporting income. Businesses will now need to report to the ATO payments made to contractors providing services in these industries. This will allow the ATO to check that contractors are complying with their tax obligations.

Expansion of the TPRS represents part of the progressive program of reform to reporting arrangements. Further reporting arrangements for high risk parts of the economy (e.g. the gig economy) will be considered over time. Given the potential for growth in the gig economy, it is important that participants are complying with their obligations at this early stage of a growing industry. This ensures that all businesses pay the right amount of tax regardless of their business model or industry.

These reforms build on other Government policies. The Single Touch Payroll initiative will be rolled out to employers with 20 or more employees from 1 July 2018 and to employers with fewer than 20 employees from 1 July 2019. This will provide business with a faster, simpler and cheaper way of complying with their reporting obligations while also reducing opportunities for black economy participants to hide activity.

Box 3: Success of the TPRS The TPRS was first introduced in the building and construction industry and raised an

additional $2.3 billion in tax liabilities in its first year alone (2012-13). This included:

• $265 million from outstanding returns lodged;

• $506 million in GST;

• $1,128 million Pay As You Go wages; and

• $357 million Pay As You Go instalments.

Further amounts were collected for that income year in subsequent years.

Current data suggests that expanding the TPRS will continue this success. For example, ATO analysis of contractor data for the IT industry (computer system design and related services) for the last three financial years has found that non-lodgement by contractors has increased to about 30 per cent. Incomes reported by IT contractors to the ATO are also significantly lower than average wages reported by industry market research.


8

Encouraging the transition to a digital society

Cash provides an easy, anonymous and largely untraceable mechanism for conducting black economy activity. Cash payments make it easier to under-report income and avoid tax obligations. This allows businesses transacting in cash to undercut competitors and gain a competitive advantage. The Taskforce identified examples of large undocumented cash payments being made for houses, cars, yachts, agricultural crops and commodities. These practices perpetuate black economy activities and hurt honest businesses.

The Government will introduce a cash payment limit of A$10,000 on payments made to businesses. This will not cover individual-to-individual transactions. The cash limit is aimed at reducing opportunities for criminals to launder the proceeds of crime into goods and services or for businesses to hide transactions to reduce their tax liabilities.

Cash will still remain a legitimate means of purchasing goods and services. However, advances in digital technology are increasingly providing a viable alternative to cash. For instance, the New Payments Platform offers real-time transactions for users. Electronic transactions also offer a number of benefits for Australians, often being safer, easier and more cost-effective. Consumer preferences are already driving this change with Australians being amongst the highest users of digital transactions in the world.

Many businesses have also adopted digital transaction systems, acknowledging the distinct advantages they offer. These include lower risk of theft and quicker, more streamlined record keeping and reporting. The Government established a Small Business Digital Taskforce to support this transition. The Taskforce looked at how to make it easier for small businesses to adopt digital technologies.

The Government will consult on how best to implement the new cash payment limit and related reforms such as mandating the payment of salary and wages into bank accounts.

Box 4: Transitioning to digital Australians have embraced the change to a digital society.

In 2007, around 69 per cent of Australian transactions were in cash. Only 9 years later, in 2016, around 37 per cent of Australian transactions were in cash.

This represents an unprecedented increase in digital transactions.

While countries like the United States and Sweden are still higher users of digital commerce, Australians love technology and will likely follow suit. We are the biggest users of ‘tap and go’ technology and are spearheading initiatives like ‘Osko’ which will allow real-time individual-to-individual transactions as part of the New Payments Platform.

Despite Australians embracing this change, there is a small cohort of people who continue to rely on cash to enable or fund their participation in the black economy.

Australia is not alone in contemplating a cash limit. A number of other countries such as France, Portugal, Greece, Spain, Italy and Belgium have cash limits varying from A$1,600 to A$4,800. Israel and the UK have also been reported to be contemplating or consulting on cash limits.


9

Levelling the playing field

The black economy creates an uneven playing field and challenges the basic premise that everyone in Australia is entitled to a ‘fair go’. The Taskforce report highlights the unfairness created by the black economy on society, business and individuals. The Government is committed to levelling the playing field for businesses and individuals that do the right thing.

High profile actions in recent years against multinational tax avoidance have sent a strong message that those doing the wrong thing will be caught. However, action on other black economy issues such as paying cash in hand to avoid obligations or underpaying employees has been less public. The Government response seeks to emphasise that these behaviours are just as harmful and are even more pervasive. Black economy participants who choose to engage in these behaviours are hurting honest Australians.

The Government has already taken action to address the exploitation of vulnerable workers through the Fair Work Amendment (Protecting Vulnerable Workers) Act 2017. The Act introduced higher penalties for contraventions of workplace laws and enhanced evidence gathering powers for the Fair Work Ombudsman to facilitate investigations and protect vulnerable employees. The Government’s Migrant Workers Taskforce also continues to investigate how to improve conditions for this vulnerable group.

Through this response, the Government will introduce further measures aimed at levelling the playing field for business. This will ensure that participants in the black economy do not get access to the same rights as those who meet their obligations.

Businesses will no longer be able to claim deductions for wages paid to employees or for payments made to contractors where they have disregarded their withholding obligations. This will send a message to businesses that engaging in the black economy and facilitating others’ non-compliance is unacceptable.

The Government will make Australian supply chains fairer by preventing businesses tendering for large government contracts if they have not met their taxation obligations. Businesses tendering for Australian Government contracts over $4 million (inclusive of GST) will be required to provide a statement from the ATO confirming that they have a satisfactory tax record. This will increase the public’s confidence that honest businesses are being awarded government contracts. It will also set an example for other businesses to follow suit in quality procurement practices.

This will be supported by the creation of a national framework for private supply chains which will guide businesses in developing responsible supply chain management practices.

Box 5: Changing supply chain culture In 2016-17, total Australian Government procurement was almost $47.4 billion from

64,092 contracts. The majority of these contracts were over $4 million.

This places the Australian Government as one of the largest procurers of goods and services in Australia and in a position to influence broader supply chain behaviour.

While businesses are currently required to act in accordance with the law, introducing a specific requirement will ensure that tax compliance is taken into account when awarding contracts. Statements will be issued through an automated system within two to four days to minimise any compliance costs.

Changes to supply chain practices can have a big impact on culture, affecting numerous layers of businesses across multiple industries.


10

More transparent and targeted enforcement and prosecution

The black economy is more diverse, more complex and influenced by a wider range of factors than at any time in history. The uptake and spread of new business models can facilitate black economy activities. The Taskforce found that new approaches are needed to match the growth in black economy activity. For instance, by providing education focused on small business owners, youth and migrants to discourage them from entering the black economy.

The Government will deliver more targeted, stronger and more visible enforcement. A new hotline will be supported by new IT infrastructure to ensure that community information can be transformed into metadata which can then feed into enforcement action. Advances in technology, such as data fusion, will be used to convert this new data into a comprehensive picture of black economy participants and behaviours. The Government is also considering how it can increase data sharing across key agencies, including with State and Territory Governments. These changes will offer agencies across government more seamless identification of black economy participants.

Enhanced data capabilities will be accompanied by an increased physical presence. New mobile strike teams and a black economy audit force will visit geographic areas and businesses that have never been visited before.

These measures will be combined with a new Black Economy Standing Taskforce to deliver a more coordinated approach to addressing black economy behaviours. The Taskforce, to be led by the ATO, will work with other enforcement agencies like the Australian Federal Police and the Australian Transaction Reports and Analysis Centre to stamp out the worst offenders.

The Government will also review the current provisions that provide civil, criminal and administrative penalties for black economy activity to ensure sanctions available reflect the harm done. As part of this process, consideration will be given to developing more effective prosecution processes and introducing new criminal offences, civil penalties or administrative penalties.

Box 6: A success story – the Serious Financial Crimes Taskforce Cross-government taskforces, like the new Black Economy Standing Taskforce, bring

together data, knowledge, resources and experience. This means greater ability to identify and address serious breaches of the law.

Other taskforces, like the Serious Financial Crimes Taskforce (SFCT), have been highly successful. Through its enforcement action, the SFCT has had five successful criminal prosecutions and collected over $203 million in cash (as at 31 March 2018).

Taskforce agencies – the Australian Criminal Intelligence Commission, the Australian Taxation Office, the Australian Federal Police and the Australian Transaction Reports and Analysis Centre – have worked closely with domestic and international partners to analyse data related to the Panama Papers and the Paradise Papers.

Over 80 matters related to the Panama Papers are underway. In addition, 53 taxpayers have indicated that they want to come forward to make a disclosure, with $40 million in liabilities expected to come from this.


11

Disrupting illegal activity

Illegal and criminal activities are often seen as separate from black economy behaviours such as demanding or paying cash in hand for work so as to avoid obligations. However, traditional views which quarantined the cash and criminal economies are outdated, with criminals looking to exploit weaknesses across the tax, regulatory, visa, employment, welfare and financial systems. Legal or system-based weaknesses are often used to derive funds, or other benefits, which can then be funnelled into illegal activity.

The Government response takes a new approach by seeking to address criminal behaviour across the entire black economy. Targeted enforcement action to stamp out criminality remains a key part of this strategy. Illicit tobacco and illegal gambling are increasingly becoming pressure points, requiring dedicated strategies to prevent these activities from fuelling other black economy activity.

Illicit tobacco undermines efforts to address the harmful health effects of smoking and results in a significant loss to revenue every year. This is why the Government is launching a comprehensive package to stamp out illicit tobacco. This builds on the stronger penalties for illicit tobacco and increased enforcement announced in the 2016–17 Budget.

The new package will help prevent leakage of imported tobacco from licensed warehouses by moving the taxing point to the border and requiring a permit for importation. On-the-ground resources will support these measures and prevent other sources of illicit tobacco such as domestic tobacco crops and smuggling. Together, these measures will protect the integrity of the tobacco duty regime, remove a key source of funding for organised crime, and support existing tobacco control policies such as plain packaging.

Illegal offshore gambling is growing rapidly as advances in technology have allowed more people to access offshore gambling facilities. Unlicensed operators are increasingly linked to organised crime gangs and are using illegal gambling as a source of funds for their activities. The Government has successfully implemented the first stage of reforms to curb illegal gambling and will continue working with State and Territory Governments to agree a joint Commonwealth, State and Territory National Consumer Protection Framework for online wagering by mid-2018.

Box 7: Targeting illicit tobacco The Government’s comprehensive package combatting illicit tobacco will build on the

efforts achieved to date. Since 1 October 2015, the Australian Border Force Tobacco Strike Team has seized almost 109 tonnes of smuggled tobacco and almost 248 million smuggled cigarettes. This is equivalent to $246 million in duty forgone. The new Illicit Tobacco Taskforce, which will replace the Tobacco Strike Team, will strengthen the ability of agencies to investigate, prosecute and ultimately dismantle the criminal groups responsible for a large part of the illicit tobacco trade. Since 1 July 2016, the ATO has undertaken 32 seizures totalling 215 tonnes of illicit tobacco with estimated duty forgone of $179 million. Additional funding for the ATO will provide additional investigative resources which will be used in the fight against domestic illicit tobacco. On-the-ground action has been making a difference. In March 2018, government agencies seized $30 million worth of illegally grown tobacco in the largest cross-agency operation ever. This will be supported by legislation that will impose tougher penalties for possessing, buying, selling and producing illicit tobacco. This includes up to 10 years imprisonment and up to 5 times the duty that would have been payable.


13

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latio

n, th

e Re

serv

e Ba

nk o

f Aus

tral

ia

(RBA

) sho

uld

cons

ider

whe

ther

ther

e ar

e fu

rthe

r act

ions

it c

ould

take

to p

ut

dow

nwar

d pr

essu

re o

n in

terc

hang

e fe

es th

at w

ould

be

in th

e pu

blic

inte

rest

.

The

Gove

rnm

ent s

uppo

rts m

easu

res t

o pl

ace

dow

nwar

d pr

essu

re o

n no

n-ca

sh p

aym

ent c

osts

and

will

refe

r thi

s rec

omm

enda

tion

to th

e Pa

ymen

ts S

yste

m B

oard

for c

onsid

erat

ion.

Task

forc

e re

com

men

datio

n 3.

4 —

Brin

ging

dow

n th

e co

st o

f deb

it ca

rd

tran

sact

ions

for b

usin

esse

s

The

RBA’

s Pay

men

ts S

yste

m B

oard

shou

ld c

onsid

er re

gula

ting

to e

nsur

e do

wnw

ard

pres

sure

on

the

cost

of d

ebit

card

pay

men

ts. I

n pa

rtic

ular

, whe

re

debi

t car

ds a

llow

for t

he a

utho

risat

ion

of th

e tr

ansa

ctio

n to

occ

ur v

ia tw

o di

ffere

nt n

etw

orks

, mer

chan

ts sh

ould

be

give

n th

e ab

ility

to se

nd th

e tr

ansa

ctio

n vi

a th

e lo

wer

cos

t net

wor

k.

The

RBA

shou

ld a

lso se

ek to

ens

ure

that

effe

ctiv

e pr

ice

com

petit

ion

amon

g pa

ymen

t net

wor

ks is

mai

ntai

ned

for d

ual n

etw

ork

debi

t car

d us

age

in th

e co

ntex

t of m

obile

wal

let t

echn

olog

y.

The

Gove

rnm

ent s

uppo

rts m

easu

res t

o pl

ace

dow

nwar

d pr

essu

re o

n no

n-ca

sh p

aym

ent c

osts

and

will

refe

r thi

s rec

omm

enda

tion

to th

e Pa

ymen

ts S

yste

m B

oard

for c

onsid

erat

ion.

The

Paym

ents

Sys

tem

Boa

rd, i

n its

Feb

ruar

y 20

18 m

eetin

g ou

tcom

es

stat

emen

t, ha

s ind

icat

ed th

at it

exp

ects

to m

ake

a de

cisio

n at

its

May

201

8 m

eetin

g as

to w

heth

er th

e m

arke

t is p

rovi

ding

som

e ne

w

nece

ssar

y fu

nctio

nalit

y fo

r tap

-and

-go

debi

t car

d pa

ymen

ts o

r whe

ther

th

e RB

A sh

ould

issu

e a

draf

t sta

ndar

d fo

r con

sulta

tion.

Task

forc

e re

com

men

datio

n 3.

5 —

Ince

ntiv

es to

mov

e to

a n

on-c

ash

busin

ess m

odel

The

Gove

rnm

ent s

houl

d of

fer i

ncen

tives

to sm

all b

usin

esse

s to

adop

t ent

irely

no

n-ca

sh b

usin

ess m

odel

s, in

clud

ing

tax

inst

alm

ent t

imin

g re

lief a

nd

pref

eren

tial t

reat

men

t as t

rust

ed ta

xpay

ers.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith su

ppor

ting

smal

l bus

ines

ses

mov

ing

to a

non

-cas

h m

odel

whe

re a

ppro

pria

te fo

r the

ir bu

sines

s.

The

Smal

l Bus

ines

s Dig

ital T

askf

orce

repo

rt h

as lo

oked

at h

ow to

mak

e it

easie

r for

bus

ines

ses t

o ad

opt d

igita

l tec

hnol

ogie

s.


15

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 3.

6 —

Gai

ning

a b

ette

r und

erst

andi

ng o

f th

e us

e an

d ro

le o

f hig

h va

lue

bank

note

s

The

RBA

shou

ld u

nder

take

rese

arch

, in

conj

unct

ion

with

gov

ernm

ent

agen

cies

, fin

anci

al in

term

edia

ries a

nd o

ther

s, to

dev

elop

a b

ette

r un

ders

tand

ing

of th

e us

e, ro

le a

nd lo

catio

n of

the

$50

and

$100

not

es.

The

Gove

rnm

ent s

uppo

rts t

he R

BA u

nder

taki

ng c

ontin

ued

rese

arch

in th

is ar

ea in

col

labo

ratio

n w

ith re

leva

nt a

genc

ies a

nd e

stab

lishm

ent o

f ad

equa

te in

form

atio

n sh

arin

g ar

rang

emen

ts.

The

Gove

rnm

ent w

elco

mes

the

rele

ase

of th

e RB

A Bu

lletin

in M

arch

201

8 w

hich

incl

uded

a d

iscus

sion

on th

e us

e of

hig

h de

nom

inat

ion

bank

note

s, dr

awin

g on

inpu

t fro

m th

e Ba

nk o

f Can

ada

and

the

Bank

of E

ngla

nd. T

he

Gove

rnm

ent r

ecog

nise

s the

impo

rtan

ce o

f thi

s wor

k an

d w

ill se

ek th

e RB

A’s a

ssist

ance

in u

pdat

ing

this

info

rmat

ion.

Task

forc

e re

com

men

datio

n 3.

7 —

ABN

ver

ifica

tion

in

elec

tron

ic p

aym

ents

Verif

ied

ABN

s sho

uld

be in

clud

ed in

the

data

att

ache

d to

all

elec

tron

ic

paym

ents

, sta

rtin

g w

ith th

e N

ew P

aym

ents

Pla

tfor

m.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n. T

he

Gove

rnm

ent’s

firs

t prio

rity

is to

look

at p

oten

tial r

efor

ms t

o th

e AB

N

syst

em (r

efer

to th

e Go

vern

men

t’s re

spon

se to

reco

mm

enda

tion

4.2)

. Fu

rthe

r con

sider

atio

n w

ill th

en b

e gi

ven

to w

heth

er A

BN d

ata

can

be

inco

rpor

ated

in o

ther

pro

cess

es su

ch a

s the

New

Pay

men

ts P

latf

orm

.

Task

forc

e re

com

men

datio

n 4.

1 —

An

iden

tity

solu

tion

for t

he

mod

ern

econ

omy

To c

ount

er th

e ris

ing

risk

of id

entit

y th

eft,

the

Gove

rnm

ent s

houl

d in

trod

uce

a st

anda

rdise

d id

entit

y fr

amew

ork

that

ena

bles

bus

ines

ses a

nd in

divi

dual

s to

prov

e th

eir d

igita

l ide

ntity

qui

ckly

and

secu

rely

. Thi

s will

allo

w in

divi

dual

s,

thro

ugh

the

use

of a

bio

met

rical

ly se

cure

d di

gita

l cre

dent

ial,

to u

se th

eir

prov

en d

igita

l ide

ntity

in a

ll in

tera

ctio

ns w

ith th

e Co

mm

onw

ealth

Go

vern

men

t and

the

priv

ate

sect

or.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n. T

he

Gove

rnm

ent’s

Dig

ital T

rans

form

atio

n Ag

ency

(DTA

) is c

urre

ntly

dev

elop

ing

a Tr

uste

d Di

gita

l Ide

ntity

Fra

mew

ork,

whi

ch in

clud

es th

e Go

vern

men

t’s

digi

tal i

dent

ity p

rogr

am, G

ovpa

ss. G

ovpa

ss w

ill m

ake

it ea

sier f

or p

eopl

e to

acc

ess g

over

nmen

t ser

vice

s and

offe

r qui

ck a

nd si

mpl

e op

tions

to p

rove

w

ho th

ey a

re.


16

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 4.

2 —

ABN

refo

rms

The

Gove

rnm

ent s

houl

d st

reng

then

the

inte

grity

of t

he A

BN sy

stem

to

prov

ide

conf

iden

ce in

the

iden

tity

and

legi

timac

y of

Aus

tral

ian

busin

esse

s.

Actio

n sh

ould

be

thro

ugh

a nu

mbe

r of i

mm

edia

te m

easu

res t

o im

prov

e th

e in

tegr

ity o

f the

cur

rent

ABN

syst

em, i

nclu

ding

pro

visio

n of

TFN

on

appl

icat

ion;

rem

ovin

g en

title

men

t fro

m sp

ecifi

c gr

oups

sinc

e th

ey a

re n

ot

entit

led

to c

arry

on

an e

nter

prise

(as r

equi

red

for e

ligib

ility

); pe

riodi

c re

new

al; m

ore

timel

y ca

ncel

latio

ns; a

nd b

ette

r dat

a m

atch

ing.

A nu

mbe

r of m

ediu

m te

rm re

form

s sho

uld

then

be

prog

ress

ed, s

uch

as

intr

oduc

ing

an A

BN re

new

al fe

e an

d en

surin

g th

at th

ere

is a

singl

e iss

uer o

f AB

Ns a

nd o

ne c

onso

lidat

ed b

usin

ess r

egist

ry.

The

Gove

rnm

ent a

gree

s tha

t the

ABN

syst

em n

eeds

to b

e as

robu

st a

s po

ssib

le in

ord

er to

ens

ure

the

inte

grity

of t

he ta

x sy

stem

.

The

Gove

rnm

ent w

ill c

onsu

lt w

ith st

akeh

olde

rs o

n th

e Ta

skfo

rce’

s re

com

men

datio

n to

info

rm th

e sc

ope

of re

form

s to

the

ABN

syst

em. T

his

will

incl

ude

issue

s suc

h as

regu

lar r

enew

als o

f an

ABN

, whe

n an

ABN

sh

ould

be

revo

ked

and

the

pote

ntia

l for

a re

gist

ratio

n an

d re

new

al fe

e.

Task

forc

e re

com

men

datio

n 4.

3 —

Cre

atio

n of

a si

ngle

bu

sines

s reg

ister

The

Gove

rnm

ent s

houl

d in

tegr

ate

the

Com

pani

es R

egist

er, A

ustr

alia

n Bu

sines

s Reg

ister

(ABR

) and

Bus

ines

s Nam

es R

egist

er in

to a

sing

le re

gist

er

mai

ntai

ned

by a

sing

le a

genc

y.

In th

e in

terim

, age

ncie

s mus

t con

tinue

thei

r effo

rts t

o im

prov

e th

e in

tegr

ity

of th

e se

para

te re

gist

ers.

Oth

er b

usin

ess r

egist

ers s

houl

d be

pro

gres

sivel

y in

tegr

ated

ove

r tim

e.

The

Gove

rnm

ent a

gree

s and

is c

urre

ntly

exp

lorin

g de

liver

y ap

proa

ches

to

mod

erni

se b

usin

ess r

egist

ers,

incl

udin

g es

tabl

ishin

g a

who

le-o

f-gov

ernm

ent r

egist

ry p

latfo

rm th

at w

ill d

eliv

er m

oder

nise

d bu

sines

s reg

istra

tion

and

licen

sing

serv

ices

for t

he A

ustr

alia

n co

mm

unity

.

A de

taile

d bu

sines

s cas

e to

mod

erni

se a

nd c

ombi

ne th

e bu

sines

s reg

ister

s ad

min

ister

ed b

y th

e Au

stra

lian

Secu

ritie

s and

Inve

stm

ents

Com

miss

ion

and

the

Aust

ralia

n Bu

sines

s Reg

istra

r will

be

deve

lope

d in

201

8-19

.

Mod

erni

sing

the

busin

ess r

egist

ers w

ill m

ake

it ea

sier f

or b

usin

esse

s to

inte

ract

with

gov

ernm

ent,

and

form

s par

t of t

he N

atio

nal B

usin

ess

Sim

plifi

catio

n In

itiat

ive.

The

Gove

rnm

ent i

s also

dev

elop

ing

a Di

rect

or Id

entif

icat

ion

Num

ber (

DIN

) as

par

t of t

he M

oder

nisin

g Bu

sines

s Reg

ister

s pro

gram

.


17

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 5.

1 —

Dev

elop

men

t of a

bla

ck e

cono

my

data

stra

tegy

The

Gove

rnm

ent s

houl

d im

plem

ent a

bla

ck e

cono

my

data

stra

tegy

whi

ch

incl

udes

:

• In

the

shor

t ter

m: M

oder

nisin

g th

e se

crec

y pr

ovisi

ons o

f rel

evan

t ag

enci

es; d

evel

opin

g a

cent

ral l

ist o

f whi

ch a

genc

y co

llect

s whi

ch d

ata;

an

d Co

mm

onw

ealth

and

Sta

te a

nd T

errit

ory

Gove

rnm

ents

wor

king

to

geth

er to

iden

tify

spec

ific

area

s whe

re p

olic

y ha

rmon

isatio

n or

sim

plifi

catio

n w

ould

lead

to a

n al

ignm

ent o

f dat

a de

finiti

ons.

• In

the

med

ium

term

: Im

prov

ing

data

and

info

rmat

ion

shar

ing

betw

een

Stat

es a

nd T

errit

orie

s and

the

Com

mon

wea

lth.

• In

the

long

term

: Int

rodu

cing

a w

hole

-of-g

over

nmen

t Dat

a Sh

arin

g Ac

t; an

d co

nsid

erin

g m

igra

ting

gove

rnm

ent r

ecor

ds o

nto

bloc

k ch

ain

tech

nolo

gy a

s the

tech

nolo

gy m

atur

es.

The

Gove

rnm

ent a

gree

s tha

t im

prov

ed d

ata

shar

ing

acro

ss k

ey a

genc

ies,

in

clud

ing

with

Sta

te a

nd T

errit

ory

Gove

rnm

ents

is a

n im

port

ant

mec

hani

sm fo

r com

batt

ing

the

blac

k ec

onom

y.

As p

art o

f the

resp

onse

to th

e Pr

oduc

tivity

Com

miss

ion’

s Inq

uiry

on

Data

Av

aila

bilit

y an

d us

e, th

e Go

vern

men

t has

ann

ounc

ed it

will

:

• Es

tabl

ish a

Nat

iona

l Dat

a Co

mm

issio

ner t

o im

plem

ent a

nd o

vers

ee a

sim

pler

, mor

e ef

ficie

nt d

ata

shar

ing

and

rele

ase

fram

ewor

k.

• In

trod

uce

legi

slatio

n to

impr

ove

the

shar

ing,

use

and

reus

e of

pub

lic

sect

or d

ata

whi

le m

aint

aini

ng th

e st

rong

secu

rity

and

priv

acy

prot

ectio

ns th

e co

mm

unity

exp

ects

.

• Es

tabl

ish a

new

Nat

iona

l Dat

a Ad

viso

ry C

ounc

il to

adv

ise th

e N

atio

nal

Data

Com

miss

ione

r on

ethi

cal d

ata

use,

tech

nica

l bes

t pra

ctic

e, a

nd

indu

stry

and

inte

rnat

iona

l dev

elop

men

ts.

Task

forc

e re

com

men

datio

n 5.

2 —

Impr

ovin

g go

vern

men

t da

ta a

naly

tics

The

Gove

rnm

ent s

houl

d co

ntin

ue to

prio

ritise

impr

ovem

ents

to th

e da

ta

anal

ytic

s cap

abili

ty o

f the

regu

lato

ry a

nd la

w e

nfor

cem

ent a

genc

ies t

hat d

eal

with

bla

ck e

cono

my

activ

ity, e

spec

ially

the

ATO

.

The

data

ana

lytic

s fun

ctio

ns o

f reg

ulat

ory

and

law

enf

orce

men

t age

ncie

s re

spon

sible

for p

olic

ing

blac

k ec

onom

y ac

tiviti

es a

re a

t var

ious

leve

ls of

m

atur

ity. G

over

nmen

t sho

uld

ensu

re th

at th

ese

agen

cies

are

ade

quat

ely

fund

ed so

that

they

can

pro

cure

and

leve

rage

cut

ting

edge

dat

a an

alyt

ics

tech

nolo

gy, d

evel

op sm

art a

lgor

ithm

s and

trai

n or

acq

uire

staf

f with

the

right

da

ta li

tera

cy sk

ills.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e th

at im

prov

ed d

ata

anal

ytic

s in

regu

lato

ry a

nd e

nfor

cem

ent a

genc

ies e

nhan

ces t

he a

bilit

y of

age

ncie

s to

dete

ct b

lack

eco

nom

y ac

tivity

.

As n

oted

in th

e Go

vern

men

t’s re

spon

se to

reco

mm

enda

tion

5.1,

ther

e ar

e im

port

ant p

roce

sses

und

erw

ay w

hich

will

faci

litat

e be

tter

shar

ing

and

use

of d

ata.

Acro

ss th

e Au

stra

lian

Publ

ic S

ervi

ce, i

n pa

rtne

rshi

p w

ith p

ublic

, priv

ate

and

rese

arch

sect

ors,

the

Gove

rnm

ent i

s com

mitt

ed to

opt

imisi

ng th

e us

e an

d re

use

of d

ata,

to re

leas

e no

n-se

nsiti

ve d

ata

and

to c

olla

bora

te w

ith

the

rese

arch

sect

or to

exp

and

the

valu

e of

pub

lic d

ata.


18

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 6.

1 —

Exp

ansio

n of

repo

rtin

g sy

stem

s

To re

duce

the

tran

spar

ency

gap

in o

ur re

port

ing

arra

ngem

ents

, the

Go

vern

men

t sho

uld:

• p

rogr

essiv

ely

expa

nd th

e TP

RS to

furt

her h

igh

risk

indu

strie

s and

sect

ors;

• ex

tend

the

third

par

ty re

port

ing

regi

me

appl

ying

to so

me

gove

rnm

ent

entit

ies t

o al

l gov

ernm

ent e

ntiti

es; a

nd

• al

low

for t

he re

mov

al o

f TPR

S re

port

ing

oblig

atio

ns fr

om in

dust

ries w

hich

ha

ve in

crea

sed

thei

r rep

ortin

g co

mpl

ianc

e an

d ar

e m

eetin

g be

nchm

arks

.

The

Gove

rnm

ent a

gree

s and

will

exp

and

the

taxa

ble

paym

ents

repo

rtin

g sy

stem

(TPR

S) a

s wel

l as a

llow

ing

for f

illab

le o

nlin

e fo

rms.

The

TPRS

will

be

expa

nded

to th

e fo

llow

ing

indu

strie

s whi

ch h

ave

been

id

entif

ied

as b

eing

at h

ighe

r risk

of n

ot d

ecla

ring

thei

r inc

ome:

secu

rity

prov

ider

s and

inve

stig

ativ

e se

rvic

es, r

oad

frei

ght t

rans

port

, and

com

pute

r sy

stem

des

ign

and

rela

ted

serv

ices

. Thi

s will

app

ly fr

om 1

July

201

9.

The

Gove

rnm

ent w

ill fu

rthe

r con

sider

if T

PRS

shou

ld b

e ex

pand

ed to

oth

er

indu

strie

s. T

he G

over

nmen

t wou

ld n

eed

to b

e as

sure

d th

at c

ompl

ianc

e is

likel

y to

be

sust

aine

d be

fore

con

sider

ing

rem

ovin

g th

e re

port

ing

requ

irem

ents

.

The

Gove

rnm

ent c

onsid

ers t

hat t

he c

urre

nt th

ird p

arty

repo

rtin

g re

gim

e st

rikes

the

right

bal

ance

bet

wee

n in

crea

sing

tran

spar

ency

and

com

plia

nce

risks

whi

le m

aint

aini

ng c

onsis

tenc

y of

repo

rtin

g ob

ligat

ions

acr

oss t

he

priv

ate

and

publ

ic se

ctor

.

Task

forc

e re

com

men

datio

n 6.

2 —

A sh

arin

g ec

onom

y re

port

ing

regi

me

Ope

rato

rs o

f des

igna

ted

shar

ing

(‘gig

’) ec

onom

y w

ebsit

es sh

ould

be

requ

ired

to re

port

pay

men

ts m

ade

to th

eir u

sers

to th

e AT

O, D

SS a

nd o

ther

go

vern

men

t age

ncie

s as a

ppro

pria

te. T

he G

over

nmen

t sho

uld

also

con

tinue

to

raise

use

rs’ a

war

enes

s abo

ut th

e po

tent

ial t

ax o

blig

atio

ns fr

om

part

icip

atio

n in

shar

ing

econ

omy

activ

ities

.

The

Gove

rnm

ent a

gree

s tha

t the

re n

eeds

to b

e gr

eate

r tra

nspa

renc

y of

pa

ymen

ts m

ade

thro

ugh

shar

ing

econ

omy

web

sites

and

will

con

sult

with

st

akeh

olde

rs o

n ho

w th

is re

com

men

datio

n co

uld

be im

plem

ente

d.

Give

n th

e po

tent

ial f

or g

row

th in

this

area

of t

he e

cono

my,

it is

impo

rtan

t th

at p

artic

ipan

ts in

the

shar

ing

econ

omy

and

the

gig

econ

omy

are

com

plyi

ng w

ith th

eir o

blig

atio

ns a

t thi

s ear

ly st

age

of a

gro

win

g in

dust

ry.


19

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 7.

1 —

A st

rate

gy fo

r con

sum

ers

Cons

umer

s sho

uld

be e

ncou

rage

d, th

roug

h an

edu

catio

nal c

ampa

ign

as w

ell

as sp

ecifi

c in

cent

ives

and

det

erre

nts,

to b

ecom

e dr

iver

s of c

ompl

ianc

e an

d no

t be

com

plic

it in

bla

ck e

cono

my

activ

ities

. The

y ne

ed to

reco

gnise

the

risks

of

par

ticip

atin

g in

the

blac

k ec

onom

y.

The

Gove

rnm

ent a

gree

s tha

t con

sum

ers n

eed

to u

nder

stan

d th

e ris

ks

asso

ciat

ed w

ith p

artic

ipat

ing

in th

e bl

ack

econ

omy

as w

ell a

s the

loss

of

reve

nue

whi

ch c

ould

oth

erw

ise b

e sp

ent o

n es

sent

ial g

over

nmen

t se

rvic

es.

Actio

ns su

ch a

s the

cas

h pa

ymen

t lim

it w

ill h

ighl

ight

to c

onsu

mer

s tha

t th

ere

are

cost

s to

the

com

mun

ity o

f par

ticip

atin

g in

the

blac

k ec

onom

y.

Task

forc

e re

com

men

datio

n 7.

2 —

A st

rate

gy fo

r sm

all b

usin

ess

The

Gove

rnm

ent s

houl

d in

trod

uce

a re

gula

tory

safe

har

bour

for s

mal

l bu

sines

ses w

hich

are

pre

pare

d to

take

pre

scrib

ed st

eps t

o re

duce

the

com

plia

nce

risk

they

repr

esen

t (fo

r exa

mpl

e, b

y m

ovin

g to

larg

ely

non-

cash

bu

sines

s mod

els)

.

Oth

er e

lem

ents

of t

his s

trat

egy

incl

ude:

edu

catio

n (a

pilo

t cou

rse

for

voca

tiona

l edu

catio

n st

uden

ts),

a ne

w to

bus

ines

s ini

tiativ

e (fo

r new

bu

sines

ses a

nd st

art-

ups)

and

ince

ntiv

es fo

r ent

irely

non

-cas

h bu

sines

ses.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e to

a st

rate

gy fo

r sm

all b

usin

ess.

The

Go

vern

men

t is a

lread

y ta

king

step

s to

redu

ce th

e co

mpl

ianc

e bu

rden

on

smal

l bus

ines

ses.

The

Gove

rnm

ent i

s also

pro

gres

sing

the

Nat

iona

l Bus

ines

s Sim

plifi

catio

n In

itiat

ive

(NBS

I). T

he B

ette

r Bus

ines

s Ser

vice

s pill

ar o

f the

NBS

I is l

ooki

ng

at w

ays t

o sim

plify

how

bus

ines

ses r

ecei

ve a

nd a

cces

s gov

ernm

ent

info

rmat

ion

and

serv

ices

. The

Dep

artm

ent o

f Ind

ustr

y, In

nova

tion

and

Scie

nce

is co

nsul

ting

with

the

priv

ate

sect

or a

nd th

e St

ates

and

Ter

ritor

ies

on o

ppor

tuni

ties t

o de

liver

bet

ter d

igita

l ser

vice

s to

help

smal

l bus

ines

ses

star

t and

gro

w.

The

new

Bus

ines

s Reg

istra

tion

Serv

ice

has s

trea

mlin

ed C

omm

onw

ealth

re

gist

ratio

n se

rvic

es –

mak

ing

it ea

sier t

o st

art a

nd ru

n a

busin

ess.

The

M

oder

nisin

g Bu

sines

s Reg

ister

s pro

gram

(ref

er to

the

Gove

rnm

ent’s

re

spon

se to

reco

mm

enda

tion

4.3)

aim

s to

crea

te a

con

tem

pora

ry d

igita

l Au

stra

lian

busin

ess r

egist

ry se

rvic

e, re

duce

com

plex

ity fo

r bus

ines

s and

en

able

bet

ter a

cces

s to

regi

stry

dat

a.

The

Aust

ralia

n Ta

xatio

n O

ffice

has

a p

roce

ss in

pla

ce fo

r wor

king

with

st

akeh

olde

rs, i

nclu

ding

the

tax

prof

essio

n, to

iden

tify

safe

har

bour

s. Ad

min

istra

tive

safe

har

bour

s out

line

prac

tical

way

s to

mak

e it

easie

r for

ta

xpay

ers t

o co

mpl

y w

ith th

e la

w.


20

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 7.

3 —

Am

nest

y fo

r bus

ines

s

The

Gove

rnm

ent s

houl

d of

fer t

ime-

limite

d an

d ta

rget

ed a

mne

stie

s for

smal

l bu

sines

ses.

An

amne

sty

shou

ld b

e fo

llow

ed b

y an

enf

orce

men

t blit

z.

The

Gove

rnm

ent d

oes n

ot su

ppor

t thi

s rec

omm

enda

tion.

Inst

ead,

the

Gove

rnm

ent w

ill m

ake

it ha

rder

for p

eopl

e to

ope

rate

with

in

the

blac

k ec

onom

y. It

will

be

in th

eir b

est i

nter

ests

to v

olun

taril

y co

me

forw

ard

to th

e re

leva

nt re

gula

tors

bef

ore

bein

g id

entif

ied

and

pote

ntia

lly

subj

ect t

o sig

nific

ant c

ivil

or a

dmin

istra

tive

pena

lties

or c

rimin

al

pros

ecut

ion.

Task

forc

e re

com

men

datio

n 7.

4 —

A st

rate

gy fo

r tax

pra

ctiti

oner

s

The

Gove

rnm

ent s

houl

d:

• ta

ke a

ctio

n ag

ains

t im

plic

ated

adv

isers

and

pro

mot

ers;

• ta

ke m

ore

visib

le a

ctio

n ag

ains

t egr

egio

us ta

x pr

actit

ione

rs a

nd m

ake

clea

rer t

heir

ethi

cal r

espo

nsib

ility

to re

port

susp

ecte

d ill

egal

act

iviti

es a

nd

tax

evas

ion;

and

• in

crea

se th

e ca

paci

ty o

f the

Tax

Pra

ctiti

oner

s Boa

rd (T

PB) t

o ta

ke

suffi

cien

t effe

ctiv

e ac

tion

agai

nst e

greg

ious

tax

prac

titio

ners

by

incr

easin

g its

reso

urce

s and

inte

ract

ions

with

the

ATO

.

The

Gove

rnm

ent a

gree

s tha

t the

Tax

Pra

ctiti

oner

s Boa

rd (T

PB) p

lays

an

impo

rtan

t rol

e in

com

batt

ing

the

blac

k ec

onom

y.

The

TPB

will

rece

ive

addi

tiona

l fun

ding

to a

llow

it to

rece

ive

a gr

eate

r nu

mbe

r of b

lack

eco

nom

y re

ferr

als a

risin

g fr

om in

crea

sed

com

plia

nce

on

blac

k ec

onom

y ac

tivity

.

Task

forc

e re

com

men

datio

n 7.

5 —

Rem

ovin

g ta

x de

duct

ibili

ty o

f no

n-co

mpl

iant

pay

men

ts

Busin

esse

s sho

uld

not b

e ab

le to

cla

im ta

x de

duct

ions

for p

aym

ents

mad

e to

em

ploy

ees i

f the

y di

d no

t rep

ort a

nd w

ithho

ld p

rope

rly.

Sim

ilarly

, pay

men

ts to

con

trac

tors

shou

ld n

ot b

e de

duct

able

if th

e co

rrec

t AB

N w

as n

ot p

rovi

ded,

the

paye

r has

not

with

held

par

t of t

he p

aym

ent

unde

r the

‘no

ABN

with

hold

ing’

requ

irem

ents

, or t

here

is n

o in

voic

e.

The

Gove

rnm

ent a

gree

s and

will

rem

ove

the

abili

ty to

cla

im a

tax

dedu

ctio

n w

here

bus

ines

ses d

isreg

ard

thei

r with

hold

ing

requ

irem

ents

. Th

is w

ill e

nsur

e th

at b

usin

esse

s not

doi

ng th

e rig

ht th

ing

are

not g

iven

the

sam

e be

nefit

s as t

hose

that

do.


21

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 7.

6 —

Impr

ovin

g re

cord

kee

ping

pra

ctic

es

The

requ

irem

ents

for t

ax re

cord

kee

ping

pra

ctic

es sh

ould

be

clea

r and

sim

ple.

The

Gove

rnm

ent s

houl

d re

quire

bus

ines

ses t

o m

aint

ain

reco

rds t

hat i

nclu

de

key

feat

ures

of a

ll tr

ansa

ctio

ns. T

his c

ould

incl

ude

the

item

sold

, wha

t was

pa

id fo

r it,

unde

rlyin

g GS

T, th

e am

ount

, dat

e, A

BN, a

nd p

refe

rabl

y tim

e.

Pena

lties

for b

reac

hes o

f the

se ru

les s

houl

d be

des

igne

d so

that

the

ATO

has

a

rang

e of

adm

inist

rativ

e sa

nctio

ns a

vaila

ble

at it

s disc

retio

n.

The

Gove

rnm

ent a

gree

s tha

t the

requ

irem

ents

for t

ax re

cord

kee

ping

sh

ould

be

clea

r and

sim

ple

and

that

bus

ines

ses s

houl

d ad

here

to st

rong

re

cord

kee

ping

pra

ctic

es.

The

Gove

rnm

ent w

ill c

onsid

er h

ow th

ese

fact

ors a

re b

est b

alan

ced

agai

nst

the

need

to k

eep

repo

rtin

g an

d co

mpl

ianc

e co

sts l

ow.

Task

forc

e re

com

men

datio

n 8.

1 —

Tar

gete

d, st

rong

er a

nd m

ore

visib

le

enfo

rcem

ent s

trat

egy

The

Gove

rnm

ent s

houl

d im

plem

ent a

mul

ti-pr

onge

d st

rate

gy to

incr

ease

the

leve

l and

visi

bilit

y of

enf

orce

men

t and

pro

secu

tions

, cov

erin

g ta

x, in

dust

rial

rela

tions

, wel

fare

and

imm

igra

tion

and

finan

cial

regu

lato

ry c

ompl

ianc

e.

The

stra

tegy

nee

ds to

mak

e be

tter

use

of i

ntel

ligen

ce a

nd b

e fo

cuse

d on

pr

oble

m a

reas

.

The

Gove

rnm

ent a

gree

s tha

t tar

gete

d, st

rong

er a

nd m

ore

visib

le

enfo

rcem

ent a

nd p

rose

cutio

ns a

re im

port

ant i

n hi

ghlig

htin

g th

at

part

icip

atio

n in

the

blac

k ec

onom

y is

agai

nst t

he la

w a

nd h

as d

etrim

enta

l ef

fect

s acr

oss t

he c

omm

unity

.

The

Aust

ralia

n Ta

xatio

n O

ffice

will

be

fund

ed to

del

iver

a n

ew a

ppro

ach

to

enfo

rcem

ent.

This

will

incl

ude

new

mob

ile st

rike

team

s tar

getin

g bl

ack

econ

omy

beha

viou

rs su

ppor

ted

by a

n au

dit f

orce

with

bro

ader

cov

erag

e an

d re

ach

into

all

area

s of A

ustr

alia

. Thi

s will

be

com

plem

ente

d by

co

ntem

pora

ry ta

x an

d bu

sines

s edu

catio

n pr

ogra

ms.

The

exist

ing

high

leve

ls of

coo

pera

tion

betw

een

agen

cies

will

be

furt

her

supp

orte

d by

the

Gove

rnm

ent’s

new

mul

ti-ag

ency

Bla

ck E

cono

my

Stan

ding

Tas

kfor

ce (r

efer

to th

e Go

vern

men

t’s re

spon

se to

re

com

men

datio

n 16

.2) a

nd th

e Ill

icit

Toba

cco

Task

forc

e (r

efer

to th

e Go

vern

men

t’s re

spon

se to

reco

mm

enda

tion

13.2

).


22

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 8.

2 —

Mor

e ef

fect

ive

pros

ecut

ion

proc

esse

s

Pros

ecut

ion

proc

esse

s sho

uld

be m

ade

mor

e ef

fect

ive

by d

esig

natin

g th

e AT

O a

s a c

rimin

al la

w e

nfor

cem

ent a

genc

y; g

ivin

g th

e AT

O p

ower

s to

obta

in

bank

info

rmat

ion;

and

revi

ewin

g th

e ev

iden

ce g

athe

ring

pow

ers o

f oth

er

regu

lato

rs.

A sp

ecia

list t

ax tr

ibun

al sh

ould

be

crea

ted

as p

art o

f the

Fed

eral

Cou

rt.

The

Gove

rnm

ent a

gree

s to

cond

uct a

revi

ew o

f the

cur

rent

pro

visio

ns th

at

prov

ide

civi

l, cr

imin

al a

nd a

dmin

istra

tive

pena

lties

for b

lack

eco

nom

y ac

tivity

. As p

art o

f thi

s pro

cess

, con

sider

atio

n w

ill b

e gi

ven

to d

evel

opin

g m

ore

effe

ctiv

e pr

osec

utio

n pr

oces

ses a

nd in

trod

ucin

g ne

w c

rimin

al

offe

nces

, civ

il pe

nalti

es o

r adm

inist

rativ

e pe

nalti

es.

The

Gove

rnm

ent w

ill c

onsid

er th

e ex

pans

ion

of th

e ju

risdi

ctio

n of

the

fede

ral c

ourt

s to

deal

with

bla

ck e

cono

my

mat

ters

as p

art o

f thi

s rev

iew

.

Task

forc

e re

com

men

datio

n 8.

3 —

Rev

erse

onu

s of p

roof

The

Gove

rnm

ent s

houl

d co

nsid

er re

vers

ing

the

onus

of p

roof

for a

ll/so

me

elem

ents

of a

smal

l num

ber o

f ser

ious

bla

ck e

cono

my

offe

nces

and

ha

rmon

ising

the

vario

us u

nexp

lain

ed w

ealth

pro

visio

ns.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

con

sider

this

as p

art

of a

revi

ew o

f exi

stin

g of

fenc

es (r

efer

to th

e Go

vern

men

t’s re

spon

se to

re

com

men

datio

n 8.

2).

A na

tiona

l coo

pera

tive

sche

me

on u

nexp

lain

ed w

ealth

is c

urre

ntly

bei

ng

prog

ress

ed. T

his s

chem

e w

ill e

xten

d th

e Co

mm

onw

ealth

’s a

bilit

y to

pu

rsue

une

xpla

ined

wea

lth m

atte

rs a

cros

s Sta

te a

nd T

errit

ory

juris

dict

ions

th

roug

h a

limite

d te

xt-b

ased

refe

rral

from

the

Stat

es; e

nhan

ce

info

rmat

ion

shar

ing

arra

ngem

ents

bet

wee

n pa

rtic

ipat

ing

juris

dict

ions

for

unex

plai

ned

wea

lth in

vest

igat

ions

; and

enc

oura

ge g

reat

er c

oope

ratio

n be

twee

n ju

risdi

ctio

ns in

con

duct

ing

thes

e in

vest

igat

ions

.


23

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 8.

4 —

The

intr

oduc

tion

of n

ew b

lack

ec

onom

y of

fenc

es

The

Gove

rnm

ent s

houl

d co

nsid

er in

trod

ucin

g a

new

cla

ss o

f mid

-ran

ge b

lack

ec

onom

y of

fenc

es to

giv

e la

w e

nfor

cem

ent a

genc

ies a

bro

ader

rang

e of

m

ore

appr

opria

te o

ffenc

es a

nd sa

nctio

ns to

dep

loy

agai

nst b

lack

eco

nom

y be

havi

ours

.

The

Gove

rnm

ent s

houl

d al

so c

onsid

er in

trod

ucin

g a

new

cla

ss o

f str

ict

liabi

lity

offe

nces

for l

ow to

mid

-ran

ge b

lack

eco

nom

y of

fenc

es to

redu

ce th

e tim

e an

d co

st o

f enf

orce

men

t. Th

ese

offe

nces

shou

ld b

e su

pple

men

ted

with

ci

vil p

enal

ties a

nd in

frin

gem

ent n

otic

e re

gim

es to

pen

alise

bre

ache

s of t

hese

of

fenc

es.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e an

d w

ill u

nder

take

a re

view

of

exist

ing

offe

nces

(ref

er to

the

Gove

rnm

ent’s

resp

onse

to

reco

mm

enda

tion

8.2)

whi

ch w

ill a

lso c

onsid

er th

e ne

ed fo

r mor

e ef

fect

ive

pros

ecut

ion

proc

esse

s and

the

need

for n

ew b

lack

eco

nom

y of

fenc

es.

Task

forc

e re

com

men

datio

n 8.

5 —

Tra

nspa

renc

y of

be

nefic

ial o

wne

rshi

p

Entit

ies a

nd tr

usts

shou

ld b

e ob

liged

to d

isclo

se th

eir l

egal

and

con

trol

ling

owne

rs a

t the

requ

est o

f the

aut

horit

ies c

onsis

tent

with

Aus

tral

ia’s

in

tern

atio

nal o

blig

atio

ns. F

ailu

re to

com

ply

with

the

requ

est s

houl

d at

trac

t sig

nific

ant s

anct

ions

.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e an

d is

com

mitt

ed to

impr

ovin

g tr

ansp

aren

cy a

roun

d w

ho o

wns

, con

trol

s and

ben

efits

from

ent

ities

to

assis

t rel

evan

t aut

horit

ies i

n co

mba

ting

illic

it ac

tiviti

es.


24

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 9.

1 —

Incr

easin

g th

e in

tegr

ity o

f Go

vern

men

t pro

cure

men

t

The

Gove

rnm

ent s

houl

d pr

omot

e go

od ta

x be

havi

our b

y ex

clud

ing

busin

esse

s with

a b

ad ta

x re

cord

(and

con

vict

ions

of b

riber

y an

d co

rrup

tion)

fr

om it

s pro

cure

men

t pro

cess

es. T

his h

as tw

o co

mpo

nent

s:

Com

mon

wea

lth c

ontr

acts

shou

ld in

clud

e a

clau

se th

at re

quire

s con

trac

tors

an

d th

eir s

uppl

iers

to c

ompl

y w

ith a

ll ta

x le

gisla

tion

and

regu

latio

n fo

r the

du

ratio

n of

the

cont

ract

.

For l

arge

con

trac

ts, t

ende

rers

mus

t also

pro

vide

evi

denc

e of

thei

r tax

reco

rd

as p

art o

f the

pro

cure

men

t pro

cess

incl

udin

g ad

optin

g Ta

x Tr

ansp

aren

cy

Code

requ

irem

ents

.

The

Gove

rnm

ent a

gree

s with

this

reco

mm

enda

tion.

The

Gove

rnm

ent w

ill d

evel

op a

nd c

onsu

lt on

a p

olic

y th

at w

ill m

ake

it m

anda

tory

for b

usin

esse

s inv

olve

d in

gov

ernm

ent c

ontr

acts

ove

r $4

mill

ion

(incl

usiv

e of

GST

) to

prov

ide

evid

ence

of a

satis

fact

ory

tax

reco

rd.

The

Gove

rnm

ent w

ishes

to le

ad b

y ex

ampl

e in

ens

urin

g re

spon

sible

supp

ly

chai

n m

anag

emen

t and

requ

ire b

usin

esse

s to

satis

fy g

ener

al c

ompl

ianc

e w

ith th

eir t

ax o

blig

atio

ns. T

he A

ustr

alia

n Ta

xatio

n O

ffice

will

con

sult

with

th

e De

part

men

t of F

inan

ce a

nd st

akeh

olde

rs in

impl

emen

ting

this

mea

sure

.

Task

forc

e re

com

men

datio

n 9.

2 —

Sup

ply

chai

n in

tegr

ity

The

Gove

rnm

ent s

houl

d es

tabl

ish n

atio

nal p

robi

ty st

anda

rds t

hat p

rivat

e su

pply

cha

in c

ertif

icat

ion

cred

entia

ls sh

ould

com

ply

with

to e

nsur

e re

spon

sible

supp

ly c

hain

man

agem

ent p

ract

ices

are

follo

wed

. Thi

s wou

ld

incl

ude

min

imum

stan

dard

s, u

se o

f tru

sted

trad

er c

ertif

icat

ion,

and

pu

blic

atio

n of

misc

ondu

ct.

The

Gove

rnm

ent a

gree

s and

will

con

sult

with

indu

stry

to d

evel

op

appr

opria

te st

anda

rds f

or su

pply

cha

in p

ract

ices

. Fur

ther

act

ion

to e

nsur

e su

pply

cha

in in

tegr

ity w

ill b

uild

on

curr

ent i

nteg

rity

mea

sure

s alre

ady

in

plac

e su

ch a

s the

Vol

unta

ry T

ax T

rans

pare

ncy

Code

, OEC

D co

untr

y-by

-cou

ntry

repo

rtin

g ob

ligat

ions

and

Com

mon

wea

lth

Proc

urem

ent F

ram

ewor

k re

quire

men

ts. A

ctio

n in

resp

onse

to

reco

mm

enda

tion

9.1

will

also

supp

ort p

rivat

e se

ctor

supp

ly c

hain

in

tegr

ity.

The

Depa

rtm

ent o

f the

Tre

asur

y w

ill c

onsu

lt on

and

dev

elop

a n

atio

nal

stan

dard

whi

ch in

dust

ry a

ssoc

iatio

ns c

an u

se to

dev

elop

sche

mes

suita

ble

for t

heir

indu

strie

s.


25

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 10

.1 —

Tac

kle

illeg

al p

hoen

ix b

ehav

iour

The

Gove

rnm

ent s

houl

d ta

ckle

ille

gal p

hoen

ix a

ctiv

ities

thro

ugh:

• be

tter

ear

ly w

arni

ng sy

stem

s thr

ough

com

bini

ng g

over

nmen

t and

priv

ate

sect

or in

form

atio

n, in

clud

ing

thro

ugh

enha

nced

susp

icio

us m

atte

r re

port

ing

and

bett

er d

ata

shar

ing;

• ex

tend

ing

the

prom

oter

pen

alty

regi

me

to th

e ‘c

ontr

ollin

g m

inds

’;

• po

tent

ial n

ew o

ffenc

es re

latin

g to

the

prop

osed

Dire

ctor

Iden

tific

atio

n N

umbe

r; an

d

• gr

eate

r enf

orce

men

t of o

ffenc

es a

nd re

cove

ry o

f deb

ts, i

nclu

ding

thro

ugh

grea

ter e

xper

tise

in th

e AT

O in

deb

t col

lect

ion,

impr

ovem

ents

to th

e As

setle

ss A

dmin

istra

tion

Fund

and

est

ablis

hing

an

Inso

lven

cy A

dviso

ry

Pane

l.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

The

Gove

rnm

ent w

ill im

plem

ent a

com

preh

ensiv

e pa

ckag

e of

refo

rms

whi

ch fo

cus o

n de

terr

ing,

disr

uptin

g an

d pe

nalis

ing

thos

e w

ho e

ngag

e in

ill

egal

pho

enix

ing

activ

ity. T

he re

form

s fol

low

pub

lic c

onsu

ltatio

n in

201

7.

The

Gove

rnm

ent’s

Pho

enix

Tas

kfor

ce h

as so

phist

icat

ed d

ata

mat

chin

g to

ols t

o id

entif

y, m

anag

e an

d m

onito

r sus

pect

ed p

hoen

ix o

pera

tors

, and

en

able

stre

amlin

ed sh

arin

g of

tax

info

rmat

ion

betw

een

27

Com

mon

wea

lth a

nd S

tate

and

Ter

ritor

y ag

enci

es, i

nclu

ding

the

Aust

ralia

n Ta

xatio

n O

ffice

, the

Aus

tral

ian

Secu

ritie

s and

Inve

stm

ents

Com

miss

ion

and

the

Fair

Wor

k O

mbu

dsm

an.

As a

nnou

nced

in th

e 20

17-1

8 M

YEFO

, the

Gov

ernm

ent w

ill p

rovi

de a

n ad

ditio

nal $

3.1

mill

ion

over

thre

e ye

ars f

rom

201

8-19

to in

crea

se fu

ndin

g fo

r the

Ass

etle

ss A

dmin

istra

tion

Fund

. Thi

s will

bol

ster

ASI

C’s r

ole

in

curb

ing

illeg

al p

hoen

ixin

g ac

tivity

.

The

Gove

rnm

ent w

ill a

lso re

quire

com

pany

dire

ctor

s to

regi

ster

for a

un

ique

Dire

ctor

Iden

tific

atio

n N

umbe

r (DI

N).

This

is be

ing

prog

ress

ed

thro

ugh

the

Mod

erni

sing

Busin

ess R

egist

ers i

nitia

tive

(ref

er to

the

Gove

rnm

ent’s

resp

onse

to re

com

men

datio

n 4.

3).


26

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 10

.2 —

Cha

nge

the

Alie

natio

n of

Per

sona

l Se

rvic

es In

com

e ru

les a

nd st

reng

then

enf

orce

men

t

The

Gove

rnm

ent s

houl

d:

• re

view

the

Alie

natio

n of

Per

sona

l Ser

vice

s Inc

ome

rule

s, a

nd re

cons

ider

th

e op

tions

for r

efor

m c

anva

ssed

by

the

Boar

d of

Tax

atio

n;

• re

quire

taxp

ayer

s as p

art o

f the

ABN

app

licat

ion

(and

rene

wal

) pro

cess

to

indi

cate

that

they

are

an

inde

pend

ent c

ontr

acto

r. Th

e AT

O sh

ould

su

bseq

uent

ly sc

rutin

ise a

sam

ple

of c

ases

whe

re ta

xpay

ers s

elf-a

sses

s ag

ains

t the

‘res

ults

test

’ and

‘unr

elat

ed c

lient

s tes

t’; a

nd

• th

e AT

O sh

ould

und

erta

ke a

test

cas

e to

reso

lve

unce

rtai

nty

and

cont

entio

n ab

out h

ow th

e AP

SI ru

les w

ork.

The

Gove

rnm

ent d

oes n

ot su

ppor

t a re

view

of t

he A

liena

tion

of P

erso

nal

Serv

ices

Inco

me

rule

s at t

his t

ime.

The

Gove

rnm

ent w

ill c

onsu

lt on

opt

ions

to re

quire

taxp

ayer

s to

indi

cate

th

ey a

re a

n in

depe

nden

t con

trac

tor a

s par

t of t

he A

ustr

alia

n Bu

sines

s N

umbe

r app

licat

ion

(and

rene

wal

) pro

cess

.

The

Aust

ralia

n Ta

xatio

n O

ffice

is p

repa

ring

upda

ted

guid

ance

on

the

appl

icat

ion

of th

e AP

SI ru

les b

ased

on

case

s sin

ce th

e co

mm

ence

men

t of

the

rule

s.

Task

forc

e re

com

men

datio

n 10

.3 —

Bol

ster

the

sham

con

trac

ting

pena

lty p

rovi

sions

The

Gove

rnm

ent s

houl

d im

plem

ent t

he P

rodu

ctiv

ity C

omm

issio

n’s

reco

mm

ende

d ch

ange

s to

the

sham

con

trac

ting

prov

ision

s of t

he F

air W

ork

Act 2

009.

The

Prod

uctiv

ity C

omm

issio

n re

com

men

ded

that

the

lega

l thr

esho

ld fo

r a

defe

nce

of a

con

trav

entio

n of

the

sham

con

trac

ting

prov

ision

s in

the

Fair

Wor

k Ac

t 200

9 sh

ould

be

low

ered

. The

Pro

duct

ivity

Com

miss

ion

revi

ewed

th

ese

prov

ision

s in

2015

and

foun

d th

at th

e ‘re

ckle

ssne

ss’ t

est w

as g

ener

ally

to

o hi

gh a

bar

for r

egul

ator

s and

oth

ers t

o pr

ove,

and

shou

ld b

e lo

wer

ed to

a

test

of ‘

reas

onab

lene

ss’.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith a

men

ding

the

Fair

Wor

k Ac

t 20

09 to

incr

ease

the

pena

lties

for b

reac

hes o

f the

sham

con

trac

ting

prov

ision

s. H

ighe

r pen

altie

s wou

ld a

ct a

s a d

eter

rent

to sh

am c

ontr

actin

g ar

rang

emen

ts.

The

Gove

rnm

ent w

ill c

onsu

lt on

the

deta

il of

any

cha

nges

.


27

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 10

.4 —

Bla

ck e

cono

my

activ

ities

by

visa

hol

ders

The

Gove

rnm

ent s

houl

d:

• co

nsid

er m

ore

com

plia

nce

activ

ity to

det

erm

ine

whe

ther

visa

hol

ders

are

ac

ting

cons

isten

tly w

ith th

eir o

blig

atio

ns;

• pr

ovid

e a

tax

file

num

ber t

o vi

sa h

olde

rs w

ith w

ork

perm

issio

ns

imm

edia

tely

upo

n th

eir a

rriv

al; a

nd

• en

sure

visa

hol

ders

who

hav

e co

mm

itted

tax

evas

ion

are

not e

ligib

le fo

r fu

ture

visa

s, in

clud

ing

perm

anen

t res

iden

cy.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

aw

ait t

he o

utco

me

of th

e cr

oss-

agen

cy M

igra

nt W

orke

rs’ T

askf

orce

.

Fore

ign

natio

nals

conv

icte

d of

an

indi

ctab

le ta

xatio

n of

fenc

e w

ould

be

refe

rred

for c

onsid

erat

ion

of v

isa c

ance

llatio

n an

d m

ay h

ave

thei

r visa

ca

ncel

led.

Whe

re a

fore

ign

natio

nal’s

visa

has

bee

n ca

ncel

led,

they

may

be

subj

ect t

o a

tem

pora

ry o

r per

man

ent e

xclu

sion

perio

d th

at p

reve

nts t

he

gran

t of a

furt

her v

isa.

The

ATO

alre

ady

has p

rogr

ams i

n pl

ace

usin

g da

ta h

eld

by th

e De

part

men

t of

Hom

e Af

fairs

to c

heck

that

visa

hol

ders

are

com

plyi

ng w

ith th

eir t

ax

oblig

atio

ns.

Task

forc

e re

com

men

datio

n 10

.5 —

Lab

our–

hire

The

Gove

rnm

ent s

houl

d gi

ve in

-prin

cipl

e su

ppor

t for

indu

stry

-led

cert

ifica

tion

sche

mes

for l

abou

r hire

firm

s, w

hich

are

cre

dibl

e, ri

goro

us a

nd

stric

tly e

nfor

ced.

Cer

tifie

d fir

ms c

ould

be

trea

ted

as ‘t

rust

ed tr

ader

s’.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

aw

ait t

he o

utco

me

of th

e cr

oss-

agen

cy M

igra

nt W

orke

rs’ T

askf

orce

.

Und

er it

s ter

ms o

f ref

eren

ce, t

he M

igra

nt W

orke

rs’ T

askf

orce

is e

xam

inin

g la

bour

hire

pra

ctic

es fo

r com

pani

es th

at e

mpl

oy m

igra

nt w

orke

rs, a

nd is

co

nsid

erin

g pa

rtic

ular

indu

strie

s or g

roup

s of v

ulne

rabl

e w

orke

rs w

here

th

ere

are

syst

emic

pro

blem

s with

exp

loita

tion

and

unde

rpay

men

t.


28

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 10

.6 —

Str

ateg

y to

cou

nter

the

expl

oita

tion

of v

ulne

rabl

e w

orke

rs

The

Gove

rnm

ent s

houl

d im

plem

ent a

stra

tegy

to p

rote

ct v

ulne

rabl

e w

orke

rs,

incl

udin

g:

• ed

ucat

ing

high

risk

visa

hol

ders

and

mig

rant

com

mun

ities

abo

ut th

e da

nger

s of t

he b

lack

eco

nom

y;

• w

orki

ng c

lose

ly w

ith m

igra

nt c

omm

unity

org

anisa

tions

;

• w

here

app

ropr

iate

, pro

vidi

ng a

mne

stie

s to

peop

le tr

appe

d in

the

blac

k ec

onom

y;

• im

prov

ing

supp

ly c

hain

inte

grity

thro

ugh

a fr

amew

ork

of st

anda

rds a

nd

‘trus

ted

trad

ers’

con

cept

(see

reco

mm

enda

tion

9.2)

and

• pr

ovid

ing

in-p

rinci

ple

supp

ort f

or in

dust

ry-le

d ce

rtifi

catio

n of

labo

ur h

ire

(see

reco

mm

enda

tion

10.5

).

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

aw

ait t

he o

utco

me

of th

e cr

oss-

agen

cy M

igra

nt W

orke

rs’ T

askf

orce

.

The

Gove

rnm

ent h

as im

plem

ente

d a

stra

tegy

to p

rote

ct v

ulne

rabl

e w

orke

rs th

roug

h th

e im

plem

enta

tion

of it

s Pro

tect

ing

Vuln

erab

le W

orke

rs

polic

y. T

his i

nclu

des t

he e

nact

men

t of t

he F

air W

ork

Amen

dmen

t (P

rote

ctin

g Vu

lner

able

Wor

kers

) Act

201

7, in

crea

sed

fund

ing

to th

e Fa

ir W

ork

Om

buds

man

and

est

ablis

hmen

t of t

he M

igra

nt W

orke

rs’ T

askf

orce

.

The

Gove

rnm

ent d

oes n

ot su

ppor

t pro

vidi

ng a

mne

stie

s to

non-

citiz

ens

beca

use

of th

e pu

ll-ef

fect

and

adv

erse

con

sequ

ence

s suc

h ar

rang

emen

ts

crea

te. A

mne

stie

s hav

e th

e po

tent

ial t

o cr

eate

ince

ntiv

es fo

r mal

prac

tice,

un

derm

inin

g th

e in

tegr

ity o

f Aus

tral

ia’s

visa

pro

gram

s and

per

vers

ely

enco

urag

ing

non-

com

plia

nce,

and

lead

ing

to in

crea

sed

wor

ker

expl

oita

tion.

The

Gove

rnm

ent h

as p

ut in

pla

ce re

port

ing

arra

ngem

ents

to e

nsur

e th

at

tem

pora

ry v

isa h

olde

rs w

ith a

wor

k en

title

men

t att

ache

d to

thei

r visa

can

re

port

wor

k-re

late

d ex

ploi

tatio

n w

ithou

t fea

r of t

heir

visa

bei

ng c

ance

lled.

Task

forc

e re

com

men

datio

n 10

.7 —

Mar

kets

and

food

truc

ks

Stal

l hol

ders

at l

arge

and

org

anise

d m

arke

ts a

nd fo

od tr

ucks

shou

ld b

e re

quire

d to

disp

lay

thei

r ABN

s. M

arke

t ope

rato

rs sh

ould

also

be

requ

ired

to

mai

ntai

n a

list o

f sta

llhol

ders

whi

ch c

an b

e re

port

ed to

the

ATO

as r

equi

red.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

con

sider

this

reco

mm

enda

tion

as p

art o

f its

con

sulta

tion

on A

BN re

form

(ref

er to

the

Gove

rnm

ent’s

resp

onse

to re

com

men

datio

n 4.

2).


29

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 10

.8 —

Str

engt

hen

char

ities

ove

rsig

ht

The

Gove

rnm

ent s

houl

d st

reng

then

the

over

sight

of c

harit

ies,

incl

udin

g th

roug

h be

tter

risk

ass

essm

ent c

apab

ilitie

s.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e th

at st

rong

ove

rsig

ht o

f cha

ritie

s is

impo

rtan

t and

shou

ld b

e in

form

ed b

y ef

fect

ive

risk

asse

ssm

ent.

On

20 D

ecem

ber 2

017,

the

Gove

rnm

ent a

nnou

nced

a st

atut

ory

revi

ew o

f th

e Au

stra

lian

Char

ities

and

Not

-for-

prof

its C

omm

issio

n (A

CNC)

. The

re

view

will

con

sider

whe

ther

the

ACN

C ha

s the

righ

t pow

ers t

o ad

dres

s th

e ris

k of

misc

ondu

ct b

y ch

ariti

es a

nd n

ot-fo

r-pr

ofits

, or t

hose

that

wor

k w

ith th

em.

A re

port

on

the

revi

ew’s

findi

ngs a

nd re

com

men

datio

ns is

requ

ired

to b

e m

ade

to th

e Go

vern

men

t by

31 M

ay 2

018.

Task

forc

e re

com

men

datio

n 11

.1 —

Beh

avio

ural

eco

nom

ics f

ram

ewor

k

Com

mon

wea

lth d

epar

tmen

ts sh

ould

use

beh

avio

ural

eco

nom

ics p

rinci

ples

to

iden

tify

beha

viou

ral b

iase

s tha

t inc

entiv

ise b

lack

eco

nom

y be

havi

our w

hen

deve

lopi

ng p

olic

y an

d de

signi

ng a

dmin

istra

tive

proc

esse

s.

Cons

ider

atio

n sh

ould

also

be

give

n to

the

need

to a

ddre

ss th

ese

bias

es in

the

deve

lopm

ent o

f pol

icy

and

adm

inist

rativ

e re

form

s tak

ing

acco

unt o

f bro

ader

po

licy

obje

ctiv

es.

Depa

rtm

ents

shou

ld a

lso in

corp

orat

e ro

bust

hig

h qu

ality

eva

luat

ion

tech

niqu

es to

iden

tify

the

beha

viou

ral i

mpa

cts o

f pol

icy

and

adm

inist

rativ

e de

cisio

ns to

det

erm

ine

whe

re c

urre

nt a

ppro

ache

s nee

d to

be

chan

ged.

The

Gove

rnm

ent a

gree

s tha

t gov

ernm

ent d

epar

tmen

ts a

nd a

genc

ies

shou

ld u

se b

ehav

iour

al e

cono

mic

prin

cipl

es w

here

app

licab

le to

iden

tify

beha

viou

ral b

iase

s whe

n de

velo

ping

pol

icy

and

desig

ning

adm

inist

rativ

e pr

oces

ses.

Indi

vidu

al d

epar

tmen

ts a

nd a

genc

ies a

re b

est p

lace

d to

det

erm

ine

whe

n an

d ho

w to

use

beh

avio

ural

eco

nom

ic p

rinci

ples

, inc

ludi

ng w

orki

ng w

ith

the

Depa

rtm

ent o

f the

Prim

e M

inist

er a

nd C

abin

et a

nd le

vera

ging

off

the

wor

k of

age

ncie

s alre

ady

oper

atin

g un

der t

hese

prin

cipl

es.

Task

forc

e re

com

men

datio

n 11

.2 —

Cam

paig

n to

add

ress

cu

ltura

l nor

ms

The

Gove

rnm

ent s

houl

d un

dert

ake

a hi

gh p

rofil

e, n

atio

nal c

ultu

ral c

hang

e ca

mpa

ign

to a

ddre

ss th

e cu

ltura

l nor

ms a

nd c

omm

unity

per

cept

ions

that

no

rmal

ise a

nd ju

stify

bla

ck e

cono

my

beha

viou

r.

The

Gove

rnm

ent a

gree

s it i

s im

port

ant t

hat e

ffort

s to

addr

ess b

lack

ec

onom

y ac

tivity

are

car

ried

out a

cros

s all

leve

ls of

the

econ

omy

and

soci

ety.

The

Gove

rnm

ent w

ill lo

ok a

t str

ateg

ic o

ppor

tuni

ties t

o ra

ise a

war

enes

s of

the

blac

k ec

onom

y, a

s wel

l as l

ong-

term

solu

tions

to e

duca

te c

onsu

mer

s on

the

risks

in p

artic

ipat

ing

in th

ese

activ

ities

.


30

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 11

.3 —

New

-to-

busin

ess p

rogr

am

The

Gove

rnm

ent s

houl

d de

velo

p an

d im

plem

ent a

new

-to-

busin

ess p

rogr

am

whi

ch h

elps

new

bus

ines

ses t

o un

ders

tand

and

com

ply

with

thei

r tax

and

ot

her l

egisl

ativ

e ob

ligat

ions

in th

e ea

rly y

ears

of t

heir

exist

ence

. Th

is pr

ogra

m sh

ould

be

built

upo

n a

syst

emic

, evi

denc

ed b

ased

fram

ewor

k,

taki

ng a

ccou

nt o

f whe

re e

xist

ing

stra

tegi

es h

ave

faile

d an

d id

entif

ying

how

th

ey c

an b

e be

tter

targ

eted

.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n. T

he

Aust

ralia

n Ta

xatio

n O

ffice

is d

evel

opin

g ta

x lit

erac

y ed

ucat

ion

and

basic

bu

sines

s ski

lls w

ith a

focu

s on

indu

strie

s whe

re a

lack

of t

ax li

tera

cy h

as

been

iden

tifie

d (r

efer

to th

e Go

vern

men

t’s re

spon

se to

re

com

men

datio

n 11

.5).

Task

forc

e re

com

men

datio

n 11

.4 —

Indu

stry

, com

mun

ity g

roup

, ad

voca

cy a

nd u

nion

par

tner

ship

s

Regu

lato

rs sh

ould

dev

elop

form

al p

artn

ersh

ips w

ith p

eak

indu

stry

, adv

ocac

y an

d un

ion

bodi

es to

join

tly id

entif

y an

d ad

dres

s bla

ck e

cono

my

beha

viou

rs

and

attit

udes

.

T he

Gove

rnm

ent s

uppo

rts r

egul

ator

s wor

king

with

pea

k in

dust

ry,

advo

cacy

and

uni

on b

odie

s to

join

tly id

entif

y an

d ad

dres

s bla

ck e

cono

my

beha

viou

rs a

nd a

ttitu

des.

Task

forc

e re

com

men

datio

n 11

.5 —

Voc

atio

nal t

rain

ing

tax

liter

acy

pilo

t

Tax

liter

acy

educ

atio

n an

d ba

sic b

usin

ess s

kills

shou

ld b

e in

corp

orat

ed in

to

Tech

nica

l and

Fur

ther

Edu

catio

n (T

AFE)

/Voc

atio

nal E

duca

tion

and

Trai

ning

(V

ET) c

urric

ulum

s thr

ough

requ

ired

indu

stry

cer

tific

atio

n sk

ill se

ts fo

r cou

rses

of

stud

y in

fiel

ds w

here

bla

ck e

cono

my

activ

ity o

r lac

k of

tax

liter

acy

has

been

iden

tifie

d.

The

Gove

rnm

ent a

gree

s with

this

reco

mm

enda

tion.

The

Aus

tral

ian

Taxa

tion

Offi

ce w

ill d

evel

op a

ppro

pria

te ta

x lit

erac

y ed

ucat

ion

and

basic

bu

sines

s ski

lls w

ith a

focu

s on

indu

strie

s whe

re b

lack

eco

nom

y ac

tivity

or

a la

ck o

f tax

lite

racy

has

bee

n id

entif

ied.

The

prog

ram

will

focu

s on

cont

empo

rary

tax

and

busin

ess e

duca

tion

prog

ram

s tar

gete

d at

smal

l bus

ines

s ow

ners

, you

th a

nd m

igra

nts t

o he

lp

them

get

it ri

ght f

rom

the

star

t, us

ing

a ra

nge

of c

hann

els i

nclu

ding

in

dust

ry g

roup

s, fi

nanc

ial i

nstit

utio

ns, b

usin

ess m

ento

r and

supp

ort

grou

ps a

nd th

e vo

catio

nal e

duca

tion

and

trai

ning

sect

or.

The

prog

ram

will

dra

w o

n re

cent

rese

arch

abo

ut th

e ne

eds o

f sm

all

busin

ess a

nd th

e ca

uses

of t

ax c

ompl

ianc

e pr

oble

ms t

o bu

ild k

now

ledg

e an

d bu

sines

s acu

men

. The

edu

catio

n pr

ogra

m w

ill c

ompl

emen

t the

Go

vern

men

t’s F

inan

cial

Lite

racy

Str

ateg

y.


31

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 12

.1 —

Nat

iona

l Crim

inal

Dat

abas

e

The

Gove

rnm

ent s

houl

d es

tabl

ish a

Nat

iona

l Crim

inal

dat

abas

e, p

oten

tially

by

exp

andi

ng th

e N

atio

nal C

rimin

al In

telli

genc

e Sy

stem

.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

In Ju

ne 2

015,

the

Gove

rnm

ent a

nnou

nced

$9.

8 m

illio

n of

fund

ing

over

tw

o ye

ars u

nder

the

Proc

eeds

of C

rime

Act 2

002

to th

e Au

stra

lian

Crim

inal

In

telli

genc

e Co

mm

issio

n (A

CIC)

to p

ilot a

new

Nat

iona

l Crim

inal

In

telli

genc

e Sy

stem

(NCI

S). T

he p

ilot p

rogr

am c

ease

d on

30

June

201

7.

Follo

win

g an

eva

luat

ion

of th

e pi

lot p

rogr

am, i

n Ju

ly 2

017,

the

Gove

rnm

ent p

rovi

ded

a fu

rthe

r $9.

8 m

illio

n of

fund

ing

over

two

year

s un

der t

he P

roce

eds o

f Crim

e Ac

t 200

2 fo

r the

Nat

iona

l Inf

orm

atio

n Co

nnec

tivity

and

Sec

urity

Tria

l. Th

e Tr

ial w

ill b

uild

on

the

wor

k of

the

NCI

S Pi

lot P

rogr

am a

nd la

y th

e fo

unda

tion

for f

utur

e co

nnec

tivity

bet

wee

n pa

rtne

r sys

tem

s and

the

ACIC

’s in

telli

genc

e an

d op

erat

iona

l sys

tem

s.

The

inte

nt o

f the

NCI

S is

to st

reng

then

crim

inal

info

rmat

ion

and

inte

llige

nce

shar

ing

acro

ss la

w e

nfor

cem

ent a

genc

ies,

juris

dict

ions

and

the

crim

inal

inte

llige

nce

com

mun

ity. A

s wel

l as c

onne

ctin

g th

e ex

istin

g da

ta

hold

ings

and

mak

ing

sear

chin

g ac

ross

thes

e hi

ghly

effi

cien

t, N

CIS

will

also

of

fer e

nhan

ced

anal

ytic

al a

nd c

olla

bora

tion

serv

ices

.

Thro

ugh

NCI

S, th

e la

w e

nfor

cem

ent a

nd in

telli

genc

e co

mm

unity

will

hav

e an

impr

oved

abi

lity

to w

ork

toge

ther

acr

oss j

urisd

ictio

ns o

n co

mm

on

outc

omes

– im

prov

ing

safe

ty a

nd c

ritic

al in

cide

nt d

ecisi

on m

akin

g, a

nd

allo

win

g th

e ea

rlier

det

ectio

n an

d pr

even

tion

of c

rimin

al a

nd n

atio

nal

secu

rity

thre

ats.

Task

forc

e re

com

men

datio

n 12

.2 —

Gre

ater

inte

rnat

iona

l coo

pera

tion

betw

een

law

enf

orce

men

t age

ncie

s

Aust

ralia

n la

w e

nfor

cem

ent a

genc

ies s

houl

d de

epen

rela

tions

hips

with

thei

r in

tern

atio

nal c

ount

erpa

rts,

part

icul

arly

the

US

Offi

ce o

f For

eign

Ass

ets

Cont

rol.

The

Gove

rnm

ent a

gree

s tha

t int

erna

tiona

l coo

pera

tion

betw

een

law

en

forc

emen

t age

ncie

s is i

mpo

rtan

t.

The

ACIC

and

oth

er la

w e

nfor

cem

ent a

genc

ies p

artic

ipat

e in

the

Five

-Eye

s La

w E

nfor

cem

ent G

roup

, whi

ch fa

cilit

ates

coo

pera

tion

acro

ss la

w

enfo

rcem

ent a

genc

ies.

In a

dditi

on to

exi

stin

g fo

rum

s and

mea

ns o

f in

tern

atio

nal c

oope

ratio

n, re

latio

nshi

ps w

ith o

vers

eas p

artn

ers a

re

cont

inua

lly b

eing

dev

elop

ed a

nd g

row

n.


32

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 12

.3 —

Str

engt

hen

anti-

mon

ey

laun

derin

g la

ws

The

Gove

rnm

ent s

houl

d m

ake

mon

ey la

unde

ring

mor

e di

fficu

lt by

:

• ex

tend

ing

mon

ey la

unde

ring

law

s to

the

trus

t acc

ount

s of r

eal e

stat

e ag

enci

es, a

ccou

ntan

ts a

nd so

licito

rs;

• im

posin

g Kn

ow-Y

our-

Cust

omer

obl

igat

ions

on

thes

e pr

ofes

siona

ls;

• cr

acki

ng d

own

on u

nreg

ulat

ed m

oney

exc

hang

es; a

nd

• ba

nnin

g ca

sh tr

ansa

ctio

ns o

ver $

10,0

00 (s

ee re

com

men

datio

n 3.

1).

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n an

d is

prog

ress

ing

impl

emen

tatio

n of

the

reco

mm

enda

tions

from

the

stat

utor

y re

view

of t

he a

nti-m

oney

laun

derin

g an

d co

unte

r-te

rror

ism fi

nanc

ing

(AM

L/CT

F) re

gim

e. T

he G

over

nmen

t is i

mpl

emen

ting

refo

rms i

n tw

o ph

ases

to st

reng

then

, str

eam

line

and

simpl

ify A

ustr

alia

’s A

ML/

CTF

regi

me.

The

Gove

rnm

ent h

as d

eliv

ered

the

first

pha

se o

f ref

orm

s with

the

pass

age

of th

e An

ti-M

oney

Lau

nder

ing

and

Coun

ter-

Terr

orism

Fin

anci

ng B

ill 2

017

in D

ecem

ber 2

017.

The

Gove

rnm

ent w

ill c

onsid

er th

is re

com

men

datio

n in

the

seco

nd p

hase

of

the

cons

ulta

tion,

des

ign

and

impl

emen

tatio

n fo

r the

AM

L/CT

F re

form

s w

hich

will

con

tinue

thro

ugh

to 2

019.

Task

forc

e re

com

men

datio

n 12

.4 —

Boo

stin

g th

e AT

O’s

pow

ers

The

Gove

rnm

ent s

houl

d pr

ovid

e th

e AT

O w

ith p

ower

s to

com

pel i

nfor

mat

ion

from

third

par

ties s

uch

as b

anks

for t

he p

urpo

ses o

f crim

inal

inve

stig

atio

ns;

and

acce

ss te

leco

mm

unic

atio

ns m

etad

ata.

See

also

Rec

omm

enda

tion

8.2.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e to

con

sider

pro

vidi

ng th

e Au

stra

lian

Taxa

tion

Offi

ce w

ith a

dditi

onal

pow

ers f

or se

rious

fina

ncia

l crim

es a

nd w

ill

incl

ude

this

as p

art o

f its

revi

ew o

f the

exi

stin

g pe

nalti

es a

nd o

ffenc

es

regi

me

(ref

er to

the

Gove

rnm

ent’s

resp

onse

to re

com

men

datio

n 8.

2).

Task

forc

e re

com

men

datio

n 12

.5 —

Har

mon

isatio

n of

ant

i-bik

ie

gang

law

s

The

Com

mon

wea

lth, S

tate

s and

Ter

ritor

ies s

houl

d ha

rmon

ise la

ws a

pply

ing

to b

ikie

gan

gs b

y fo

llow

ing

the

juris

dict

ion

with

the

mos

t rig

orou

s pro

visio

ns.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

incl

udin

g pr

evio

us

cons

ider

atio

n by

the

Coun

cil o

f Aus

tral

ian

Gove

rnm

ents

(CO

AG) a

nd th

e ac

tions

by

som

e St

ates

to a

dopt

sim

ilar s

anct

ions

alre

ady

in p

lace

in o

ther

ju

risdi

ctio

ns.

The

Com

mon

wea

lth su

ppor

ts S

tate

and

Ter

ritor

y ef

fort

s to

deve

lop

stro

nger

legi

slativ

e re

spon

ses t

o se

rious

and

org

anise

d cr

ime,

incl

udin

g th

e th

reat

pos

ed b

y O

utla

w M

otor

cycl

e Ga

ngs.

In p

artic

ular

, the

Aus

tral

ian

Fede

ral P

olic

e le

d N

atio

nal A

nti-G

angs

Squ

ad (N

AGS)

wor

ks in

con

junc

tion

with

Sta

te p

olic

e ga

ng ta

skfo

rces

, to

enha

nce

and

supp

ort i

nves

tigat

ions

, an

d pr

ovid

e ac

cess

to th

e in

form

atio

n, in

telli

genc

e an

d ca

pabi

litie

s of

fede

ral a

genc

ies.

In 2

016,

the

Aust

ralia

n Go

vern

men

t com

mitt

ed a

furt

her

$39

mill

ion

to th

e N

AGS.


33

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 12

.6 —

San

ctio

ns fo

r ser

ious

tax

evas

ion

by n

on-c

itize

ns

Prov

ision

s for

can

celli

ng v

isas o

f tho

se c

onvi

cted

of s

erio

us ta

x of

fenc

es

shou

ld b

e st

reng

then

ed a

nd su

ch p

eopl

e sh

ould

be

rem

oved

from

Aus

tral

ia.

Addi

tiona

lly, s

uch

a co

nvic

tion

shou

ld p

reju

dice

any

futu

re a

pplic

atio

ns fo

r vi

sas,

incl

udin

g pe

rman

ent A

ustr

alia

n re

siden

cy o

r Aus

tral

ian

citiz

ensh

ip.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

The

Gove

rnm

ent h

as in

pla

ce a

rang

e of

pow

ers t

o en

sure

that

the

Aust

ralia

n co

mm

unity

is p

rote

cted

from

har

m. E

very

per

son

who

live

s in

Aust

ralia

, whe

ther

that

per

son

is a

fore

ign

natio

nal,

a ci

tizen

by

birt

h or

a

citiz

en b

y ap

plic

atio

n, m

ust u

phol

d an

d ob

ey th

e la

w. I

f a p

erso

n co

mm

its

serio

us o

ffenc

es, t

hey

are

acco

unta

ble

for t

heir

actio

ns a

nd a

re li

able

to

be d

ealt

with

in a

ccor

danc

e w

ith A

ustr

alia

n la

w.

All f

orei

gn n

atio

nals

who

wish

to e

nter

or r

emai

n in

Aus

tral

ia m

ust s

atisf

y th

e ch

arac

ter r

equi

rem

ents

und

er th

e M

igra

tion

Act 1

958

(the

Act

). If

a pe

rson

doe

s not

pas

s the

cha

ract

er re

quire

men

ts, t

he A

ct p

rovi

des f

or a

ra

nge

of re

fusa

l and

can

cella

tion

pow

ers.

Fore

ign

natio

nals

conv

icte

d of

an

indi

ctab

le ta

xatio

n of

fenc

e ar

e re

ferr

ed

for c

onsid

erat

ion

of v

isa c

ance

llatio

n an

d m

ay h

ave

thei

r visa

can

celle

d.

Whe

re th

e co

nvic

tion

resu

lts in

a te

rm o

f im

priso

nmen

t for

12

mon

ths o

r m

ore,

fore

ign

natio

nals

will

be

subj

ect t

o m

anda

tory

canc

ella

tion

prov

ision

s. If

a p

erso

n’s v

isa is

can

celle

d w

hile

they

are

in A

ustr

alia

, the

n th

e pe

rson

is re

mov

ed a

s soo

n as

reas

onab

ly p

ract

icab

le.

Whe

re a

fore

ign

natio

nal’s

visa

has

bee

n ca

ncel

led,

they

may

be

subj

ect t

o a

tem

pora

ry o

r per

man

ent e

xclu

sion

perio

d th

at p

reve

nts t

he g

rant

of a

fu

rthe

r visa

.

Task

forc

e re

com

men

datio

n 12

.7 —

Ref

orm

pro

ceed

s of c

rime

law

s

The

Gove

rnm

ent s

houl

d re

form

pro

ceed

s of c

rime

law

s by:

ext

endi

ng th

e pe

riod

for f

reez

ing

orde

rs fr

om 3

day

s to

14 d

ays;

allo

win

g fo

r the

ext

ensio

n of

free

zing

orde

r unt

il re

leva

nt fi

nanc

ial i

nstit

utio

ns h

ave

prov

ided

dat

a so

ught

by

enfo

rcem

ent a

utho

ritie

s; a

nd g

ivin

g co

urts

the

disc

retio

n to

free

ze

som

e of

the

fund

s hel

d in

a p

artic

ular

ban

k ac

coun

t.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion

and

will

con

sider

this

as p

art

of th

e re

view

of e

xist

ing

pena

lties

and

offe

nces

(ref

er to

the

Gove

rnm

ent’s

resp

onse

to re

com

men

datio

n 8.

2).


34

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 12

.8 —

Dee

m c

rimin

al e

arni

ngs t

o be

of

fsho

re p

rofit

s

The

Gove

rnm

ent s

houl

d ex

amin

e th

e fe

asib

ility

of d

eem

ing

crim

inal

s’

offs

hore

ear

ning

s to

be A

ustr

alia

n so

urce

d. T

he C

ontr

olle

d Fo

reig

n Co

mpa

ny

tax

rule

s sho

uld

mod

ified

to a

ttrib

ute

offs

hore

crim

inal

pro

ceed

s to

Aust

ralia

fo

r tax

pur

pose

s.

The

Gove

rnm

ent a

gree

s to

exam

ine

optio

ns b

y w

hich

offs

hore

ear

ning

s fr

om c

rimin

al a

ctiv

ity c

ould

be

taxe

d or

pen

alise

d in

Aus

tral

ia w

here

the

crim

es a

re c

omm

itted

in A

ustr

alia

. In

this

rega

rd, c

onsid

erat

ion

will

be

give

n to

the

cont

rolle

d fo

reig

n co

mpa

ny ta

x ru

les,

proc

eeds

of c

rime

prov

ision

s, so

urce

rule

s and

oth

er d

omes

tic ta

x ru

les a

pplic

able

to

crim

inal

act

iviti

es, a

nd th

e ex

tent

to w

hich

legi

slativ

e am

endm

ent m

ay b

e ne

cess

ary.

Task

forc

e re

com

men

datio

n 13

.1 —

Mod

erni

sing

offe

nces

that

app

ly to

ill

icit

toba

cco

The

Gove

rnm

ent s

houl

d:

• e

nact

the

toba

cco

cont

rol m

easu

res i

t ann

ounc

ed in

201

6.

• lo

cate

Com

mon

wea

lth il

licit

toba

cco

law

s in

a ne

w T

obac

co C

ontr

ol A

ct.

• cr

eate

a n

ew o

ffenc

e fo

r the

impo

rtat

ion

of la

rge

scal

e ci

gare

tte

tube

fil

ling

mac

hine

s and

oth

er c

igar

ette

man

ufac

turin

g eq

uipm

ent.

• re

quire

lice

nces

for t

he im

port

atio

n of

com

mer

cial

qua

ntiti

es o

f cig

aret

te

tube

s and

pap

ers.

• es

tabl

ish a

n ill

icit

toba

cco

agen

cy re

port

ing

to th

e Ho

me

Affa

irs

depa

rtm

ent.

The

Gove

rnm

ent a

gree

s to

the

enac

tmen

t of t

obac

co c

ontr

ol m

easu

res.

On

15 F

ebru

ary

2018

, the

Gov

ernm

ent i

ntro

duce

d th

e Tr

easu

ry L

aws

Amen

dmen

t (Ill

icit

Toba

cco

Offe

nces

) Bill

201

8 to

giv

e ef

fect

to it

s co

mm

itmen

t in

the

2016

-17

Budg

et to

stre

ngth

en il

licit

toba

cco

offe

nces

. O

n 28

Mar

ch 2

018,

the

Min

ister

for L

aw E

nfor

cem

ent a

nd C

yber

Sec

urity

in

trod

uced

the

Cust

oms A

men

dmen

t (Ill

icit

Toba

cco

Offe

nces

) Bill

201

8.

Thes

e co

mpl

emen

tary

Bill

s will

har

mon

ise il

licit

toba

cco

offe

nces

co

ntai

ned

in th

e Ex

cise

Act

190

1 an

d th

e Cu

stom

s Act

190

1. T

his w

ill g

ive

effe

ct to

a st

rong

er a

nd m

ore

cons

isten

t app

roac

h to

pen

altie

s for

do

mes

tic a

nd im

port

ed il

licit

toba

cco.

Th

e ne

w le

gisla

tion

incr

ease

s the

rang

e of

enf

orce

men

t opt

ions

ava

ilabl

e fo

r illi

cit t

obac

co o

ffenc

es, i

nclu

ding

the

intr

oduc

tion

of o

ffenc

es fo

r po

sses

sion

of e

quip

men

t use

d to

man

ufac

ture

toba

cco,

selli

ng, b

uyin

g,

man

ufac

turin

g an

d pr

oduc

ing

illic

it to

bacc

o an

d a

civi

l pen

alty

for

poss

essio

n of

toba

cco

whe

re th

e pe

rson

can

not p

rovi

de d

ocum

ents

such

as

a ta

x in

voic

e to

dem

onst

rate

that

the

toba

cco

is fo

r per

sona

l use

. Th

e ne

w o

ffenc

es w

ill a

ssist

in p

ursu

ing

succ

essf

ul c

onvi

ctio

ns in

rela

tion

to il

licit

toba

cco.

The

Aus

tral

ian

Taxa

tion

Offi

ce a

nd th

e De

part

men

t of

Hom

e Af

fairs

will

no

long

er b

e re

quire

d to

pro

ve th

e or

igin

of t

he il

licit

toba

cco

to su

cces

sful

ly p

rose

cute

offe

nder

s in

the

dom

estic

mar

ket.

The

Gove

rnm

ent w

ill a

lso b

e fo

cusin

g on

mea

sure

s to

dire

ctly

add

ress

to

bacc

o sm

uggl

ing.


35

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 13

.2 —

Coo

rdin

ated

enf

orce

men

t to

com

bat i

llici

t tob

acco

The

Gove

rnm

ent s

houl

d es

tabl

ish a

n ill

icit

toba

cco

agen

cy re

port

ing

to th

e Ho

me

Affa

irs d

epar

tmen

t.

Alte

rnat

ivel

y, th

e Go

vern

men

t sho

uld

prov

ide

fund

ing

to e

nabl

e th

e co

ntin

uatio

n of

the

Toba

cco

Strik

e fo

rce

inco

rpor

atin

g th

e AT

O’s

toba

cco

reso

urce

s int

o th

is st

rike

forc

e.

Anot

her o

ptio

n w

ould

be

to c

reat

e a

pres

crib

ed c

ross

-age

ncy

Toba

cco

Task

forc

e, w

ith c

lear

line

s of a

ccou

ntab

ility

and

lead

resp

onsib

ility

for

targ

etin

g ill

icit

toba

cco.

The

Gove

rnm

ent s

houl

d in

clud

e th

e De

part

men

t of H

ome

Affa

irs a

s a ‘l

aw

enfo

rcem

ent a

genc

y’ fo

r the

pur

pose

s of t

he S

urve

illan

ce D

evic

es A

ct so

that

it

is ab

le to

aut

horis

e th

e us

e of

surv

eilla

nce

devi

ces f

or e

nfor

cem

ent r

elat

ed

purp

oses

, suc

h as

mon

itorin

g su

spec

ted

toba

cco

ship

men

ts w

here

they

hav

e a

reas

onab

le su

spic

ion

of th

e im

port

atio

n or

han

dlin

g of

illic

it to

bacc

o.

The

Gove

rnm

ent s

houl

d co

nduc

t an

enfo

rcem

ent b

litz o

nce

impr

oved

illic

it to

bacc

o le

gisla

tion

has b

een

impl

emen

ted.

The

Gove

rnm

ent a

gree

s to

the

need

for c

oord

inat

ed e

nfor

cem

ent t

o co

mba

t illi

cit t

obac

co a

nd w

ill e

stab

lish

the

Illic

it To

bacc

o Ta

skfo

rce

whi

ch

will

ope

rate

as a

cro

ss-a

genc

y Ta

skfo

rce

with

acc

ount

abili

ty a

nd le

ad

resp

onsib

ility

for t

arge

ting

impo

rted

illic

it to

bacc

o.

The

Illic

it To

bacc

o Ta

skfo

rce

will

com

prise

mem

bers

from

a n

umbe

r of l

aw

enfo

rcem

ent a

nd b

orde

r sec

urity

age

ncie

s to

ensu

re it

has

the

capa

bilit

ies

it ne

eds t

o ef

fect

ivel

y co

mba

t the

trad

e in

illic

it to

bacc

o.

The

crea

tion

of th

e Ill

icit

Toba

cco

Task

forc

e w

ill d

eliv

er a

mul

ti-fa

cete

d ap

proa

ch th

at le

vera

ges w

hole

-of-g

over

nmen

t cap

abili

ties a

nd p

ower

s to

proa

ctiv

ely

targ

et, d

isrup

t and

pro

secu

te se

rious

and

org

anise

d cr

ime

grou

ps a

t the

cen

tre

of th

e ill

icit

toba

cco

trad

e.

The

Gove

rnm

ent w

ill in

trod

uce

a pa

ckag

e of

inte

rcon

nect

ed m

easu

res

that

targ

et th

e th

ree

mai

n so

urce

s of i

llici

t tob

acco

(sm

uggl

ing,

leak

age

from

lice

nsed

war

ehou

ses a

nd d

omes

tic p

rodu

ctio

n).

Task

forc

e re

com

men

datio

n 13

.3 —

Tra

cing

cig

aret

tes

The

Gove

rnm

ent s

houl

d ex

amin

e th

e fe

asib

ility

of i

ntro

duci

ng te

chno

logy

w

hich

mar

ks p

acks

and

cas

es to

show

whe

n ex

cise

has

bee

n co

rrec

tly p

aid.

The

Gove

rnm

ent d

oes n

ot su

ppor

t thi

s rec

omm

enda

tion.

The

Gove

rnm

ent i

s int

rodu

cing

a ra

nge

of m

easu

res t

o co

mba

t illi

cit

toba

cco.

The

Gov

ernm

ent w

ill re

view

the

succ

ess o

f the

se m

easu

res

befo

re c

onsid

erin

g fu

rthe

r mea

sure

s suc

h as

trac

ing

ciga

rett

es.

Task

forc

e re

com

men

datio

n 13

.4 —

Mov

e th

e ta

xing

poi

nt fo

r to

bacc

o ex

cise

The

Gove

rnm

ent s

houl

d ta

x to

bacc

o at

the

time

that

it e

nter

s an

Aust

ralia

n po

rt.

The

Gove

rnm

ent a

gree

s and

will

intr

oduc

e ch

ange

s to

ensu

re im

port

ers

pay

all d

uty

and

tax

liabi

litie

s for

impo

rted

toba

cco

at th

e bo

rder

. Thi

s new

m

easu

re w

ill b

e ef

fect

ive

from

1 Ju

ly 2

019.


36

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 13

.5 —

Shi

sha

toba

cco

The

Gove

rnm

ent s

houl

d re

duce

the

leve

l of d

uty

whi

ch a

pplie

s to

shish

a to

bacc

o so

that

it is

taxe

d at

app

roxi

mat

ely

the

sam

e ra

te a

s cig

aret

tes.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

Task

forc

e re

com

men

datio

n 14

.1 —

Enf

orce

exi

stin

g ill

egal

ga

mbl

ing

law

s

The

Gove

rnm

ent s

houl

d ex

amin

e ho

w to

mak

e fu

rthe

r use

of e

xist

ing

law

s,

incl

udin

g ta

x la

w, a

nti-m

oney

laun

derin

g re

gula

tion

and

law

s aga

inst

m

ultin

atio

nal p

rofit

shift

ing,

in c

omba

ttin

g ill

egal

gam

blin

g.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

Exist

ing

mul

tinat

iona

l tax

eva

sion

prov

ision

s und

er th

e tr

ansf

er p

ricin

g ru

les a

nd th

e re

cent

ly e

nact

ed D

iver

ted

Prof

its T

ax a

nd M

ultin

atio

nal

Anti-

Avoi

danc

e La

w w

ill a

ddre

ss in

tern

atio

nal g

ambl

ing

entit

ies

inap

prop

riate

ly a

void

ing

a ta

xabl

e pr

esen

ce in

Aus

tral

ia.

The

Gove

rnm

ent a

lso m

ade

amen

dmen

ts to

the

Inte

ract

ive

Gam

blin

g Ac

t 20

01 (I

GA) i

n 20

17 to

stre

ngth

en th

e en

forc

emen

t pow

ers o

f the

Au

stra

lian

Com

mun

icat

ions

and

Med

ia A

utho

rity

(ACM

A) to

bet

ter

resp

ond

to il

lega

l offs

hore

wag

erin

g. T

his r

espo

nds t

o th

e Go

vern

men

t’s

com

mitm

ents

in re

spon

se to

the

2015

Rev

iew

of I

llega

l Offs

hore

W

ager

ing.

The

Gove

rnm

ent w

ill c

ontin

ue to

exa

min

e w

ays t

o m

ake

furt

her u

se o

f ex

istin

g la

ws i

n co

mba

ting

illeg

al g

ambl

ing.


37

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 14

.2 —

Impl

emen

t rec

omm

enda

tions

set

out i

n th

e Re

view

of O

ffsho

re G

ambl

ing

The

Gove

rnm

ent s

houl

d:

• re

quire

Inte

rnet

Ser

vice

Pro

vide

rs (I

SPs)

to b

lock

offs

hore

site

s tha

t are

of

ferin

g ill

egal

gam

blin

g se

rvic

es to

Aus

tral

ians

; and

• en

cour

age

bank

s to

prev

ent t

rans

actio

ns to

and

from

offs

hore

wag

erin

g w

ebsit

es.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

Follo

win

g th

e re

leas

e of

the

2015

Rev

iew

of I

llega

l Offs

hore

Wag

erin

g, th

e Go

vern

men

t con

sulte

d w

ith IS

Ps to

ass

ess p

oten

tial o

ptio

ns in

clud

ing

volu

ntar

ily d

isrup

ting

acce

ss to

ille

gal o

ffsho

re o

nlin

e w

ager

ing

prov

ider

s th

roug

h th

e us

e of

web

site

bloc

king

or w

arni

ng p

ages

. The

Gov

ernm

ent

will

ann

ounc

e its

fina

l pos

ition

on

the

feas

ibili

ty o

f vol

unta

ry IS

P bl

ocki

ng

in d

ue c

ours

e.

The

Gove

rnm

ent i

s also

ass

essin

g th

e po

tent

ial o

ptio

ns a

nd p

ract

ical

ity o

f pa

ymen

t blo

ckin

g st

rate

gies

and

has

con

sulte

d w

ith b

anks

and

oth

er

finan

cial

inst

itutio

ns. T

he fe

asib

ility

of t

hese

mea

sure

s will

nee

d to

be

bala

nced

aga

inst

thei

r rel

ativ

e co

sts,

ben

efits

and

effe

ctiv

enes

s. T

he

Com

mon

wea

lth, S

tate

and

Ter

ritor

y go

vern

men

ts h

ave

also

agr

eed

in-p

rinci

ple

to th

e in

trod

uctio

n of

a N

atio

nal C

onsu

mer

Pro

tect

ion

Fram

ewor

k fo

r onl

ine

wag

erin

g in

Aus

tral

ia c

onta

inin

g a

suite

of t

en

cons

umer

pro

tect

ion

mea

sure

s. F

inal

agr

eem

ent t

o th

e N

atio

nal

Fram

ewor

k is

expe

cted

in m

id-2

018.

Task

forc

e re

com

men

datio

n 14

.3 —

Sep

arat

ing

unre

gula

ted

gam

blin

g fr

om le

gitim

ate

activ

ity

The

Com

mon

wea

lth G

over

nmen

t sho

uld

prev

ent r

egul

ated

gam

blin

g sit

es

from

acc

eptin

g be

ts so

urce

d fr

om u

nreg

ulat

ed si

tes.

Stat

e-ba

sed

raci

ng re

gula

tors

shou

ld p

ublic

ly w

arn

off p

eopl

e fr

om a

tten

ding

ra

cetr

acks

and

pro

secu

te th

em if

they

are

foun

d to

be

usin

g un

regu

late

d ga

mbl

ing

sites

.

Aust

ralia

n la

w e

nfor

cem

ent a

genc

ies s

houl

d ex

chan

ge in

form

atio

n ab

out

unre

gula

ted

gam

blin

g w

ith th

eir i

nter

natio

nal c

ount

erpa

rts.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n, n

otin

g th

at th

e Co

mm

onw

ealth

doe

s not

hav

e a

dire

ct ro

le in

regu

latin

g w

ager

ing

serv

ices

lice

nsed

und

er S

tate

and

Ter

ritor

y la

ws.

As p

art o

f am

endm

ents

to th

e In

tera

ctiv

e Ga

mbl

ing

Act 2

001(

IGA)

in 2

017,

th

e Au

stra

lian

Com

mun

icat

ions

and

Med

ia A

utho

rity

(ACM

A) n

ow h

as a

ra

nge

of d

eter

renc

e po

wer

s to

disr

upt i

llega

l offs

hore

wag

erin

g. T

his

incl

udes

not

ifyin

g lic

ensin

g au

thor

ities

in o

vers

eas j

urisd

ictio

ns a

bout

lic

ense

es w

ho a

re b

reac

hing

the

prov

ision

s of t

he IG

A (s

ee th

e IG

A an

d se

ctio

n 59

D of

the

Aust

ralia

n Co

mm

unic

atio

ns a

nd M

edia

Aut

horit

y Ac

t 20

05).

The

ACM

A al

so h

as a

whi

telis

t of l

icen

sed

prov

ider

s, to

bet

ter

com

mun

icat

e to

the

publ

ic w

ho is

lice

nsed

in A

ustr

alia

.


38

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 14

.4—

Bet

ter u

se o

f gam

blin

g da

ta

Info

rmat

ion

cont

aine

d in

stor

ed v

alue

car

ds a

nd b

ettin

g vo

uche

rs sh

ould

be

anal

ysed

to se

ek o

ut p

oten

tial c

rimin

al n

etw

orks

.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n. C

urre

ntly

, lic

ense

d w

ager

ing

oper

ator

s are

requ

ired

to e

xerc

ise c

usto

mer

due

di

ligen

ce in

clud

ing

tran

sact

ion

mon

itorin

g un

der t

he A

nti-M

oney

La

unde

ring

and

Coun

ter-

Terr

orism

Fin

anci

ng A

ct 2

006.

Task

forc

e re

com

men

datio

n 14

.5 —

Pre

vent

gam

blin

g be

ing

used

to

shel

ter t

ax e

vasio

n

The

Gove

rnm

ent s

houl

d re

quire

taxp

ayer

s to

keep

reco

rds o

f the

ir ga

mbl

ing

activ

ities

onc

e w

inni

ngs e

xcee

d $5

0,00

0 pe

r yea

r.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

One

of t

he c

onsu

mer

pro

tect

ion

mea

sure

s und

er th

e pr

opos

ed N

atio

nal

Cons

umer

Pro

tect

ion

Fram

ewor

k fo

r onl

ine

wag

erin

g is

the

prov

ision

of

activ

ity st

atem

ents

for o

nlin

e w

ager

ing

on d

eman

d an

d on

a re

gula

r bas

is.

This

mea

sure

will

allo

w c

onsu

mer

s to

read

ily tr

ack

thei

r wag

erin

g sp

endi

ng a

nd b

ehav

iour

, as a

har

m m

inim

isatio

n to

ol, h

owev

er it

cou

ld

also

ass

ist ta

xpay

ers w

ho g

ambl

e on

line

to k

eep

com

preh

ensiv

e re

cord

s of

thei

r onl

ine

gam

blin

g ac

tiviti

es.

Task

forc

e re

com

men

datio

n 16

.1 —

Adv

isory

boa

rd

The

Gove

rnm

ent s

houl

d es

tabl

ish a

cen

tral

age

ncy

led

advi

sory

boa

rd,

incl

udin

g bo

th p

ublic

and

priv

ate

sect

or re

pres

enta

tives

, to

mon

itor

emer

ging

tren

ds a

nd ri

sks i

n th

e bl

ack

econ

omy

and

prep

are

a fiv

e ye

arly

re

port

on

thes

e.

The

Gove

rnm

ent a

gree

s and

will

est

ablis

h an

Adv

isory

Boa

rd c

ompr

ising

pu

blic

and

priv

ate

sect

or re

pres

enta

tives

to o

vers

ee th

e im

plem

enta

tion

of th

e Bl

ack

Econ

omy

Task

forc

e re

com

men

datio

ns.

The

Advi

sory

Boa

rd w

ill a

ssist

in th

e im

plem

enta

tion

of th

e re

port

’s re

com

men

datio

ns, i

n pa

rtic

ular

thos

e re

latin

g to

bus

ines

s. T

he A

dviso

ry

Boar

d w

ill a

lso b

e in

volv

ed in

pro

vidi

ng a

dvic

e in

the

deve

lopm

ent o

f an

upda

te o

n th

e bl

ack

econ

omy

to g

over

nmen

t in

five

year

s.


39

Reco

mm

enda

tion

Gov

ernm

ent R

espo

nse

Task

forc

e re

com

men

datio

n 16

.2 —

Sta

ndin

g Ta

skfo

rce

The

Gove

rnm

ent s

houl

d es

tabl

ish a

stan

ding

task

forc

e to

iden

tify,

resp

ond

to

and

pros

ecut

e se

rious

, com

plex

bla

ck e

cono

my

frau

d.

The

Gove

rnm

ent a

gree

s tha

t the

bla

ck e

cono

my

need

s to

be a

ddre

ssed

th

roug

h a

who

le-o

f-gov

ernm

ent a

ppro

ach.

The

Gove

rnm

ent w

ill e

stab

lish

a m

ulti-

agen

cy B

lack

Eco

nom

y St

andi

ng

Task

forc

e le

d by

the

Aust

ralia

n Ta

xatio

n O

ffice

and

com

prisi

ng k

ey

depa

rtm

ents

incl

udin

g; th

e De

part

men

t of H

ome

Affa

irs, t

he D

epar

tmen

t of

Hum

an S

ervi

ces,

the

Depa

rtm

ent o

f Job

s and

Sm

all B

usin

ess.

Thi

s will

in

clud

e re

pres

enta

tion

by e

nfor

cem

ent a

genc

ies s

uch

as th

e Au

stra

lian

Fede

ral P

olic

e, th

e Au

stra

lian

Bord

er F

orce

, the

Aus

tral

ian

Crim

inal

In

telli

genc

e Co

mm

issio

n an

d th

e Fa

ir W

ork

Om

buds

man

.

The

Task

forc

e w

ill w

ork

colle

ctiv

ely

and

focu

s spe

cific

ally

on

thos

e w

ho

are

unde

rtak

ing

blac

k ec

onom

y ac

tivity

. Thi

s will

be

the

first

eve

r co

ordi

nate

d ap

proa

ch to

com

bat b

lack

eco

nom

y ac

tivity

.

Task

forc

e re

com

men

datio

n 16

.3 —

Om

buds

man

’s of

fice

and

hotli

ne

The

Gove

rnm

ent s

houl

d cr

eate

a B

lack

Eco

nom

y O

mbu

dsm

an’s

Offi

ce a

nd

hotli

ne.

The

Gove

rnm

ent a

gree

s to

esta

blish

a h

otlin

e w

ith th

e ca

pabi

lity

to

secu

rely

tran

sfer

info

rmat

ion

betw

een

exte

rnal

par

tner

age

ncie

s and

to

ensu

re th

at th

e in

form

atio

n is

sent

to th

e rig

ht a

genc

y.

The

Gove

rnm

ent n

otes

the

reco

mm

enda

tion

to c

reat

e a

Blac

k Ec

onom

y O

mbu

dsm

an’s

Offi

ce. T

he m

ulti-

agen

cy B

lack

Eco

nom

y St

andi

ng T

askf

orce

(r

efer

to th

e Go

vern

men

t’s re

spon

se to

reco

mm

enda

tion

16.2

) cou

pled

w

ith a

hot

line

will

put

in p

lace

a c

ompr

ehen

sive

arch

itect

ure

to e

nsur

e on

goin

g m

onito

ring

and

dete

ctio

n of

bla

ck e

cono

my

activ

ity. T

he

Gove

rnm

ent w

ill re

view

the

effe

ctiv

enes

s of t

hese

arr

ange

men

ts o

ver

time.


40

Gove

rnm

ent r

espo

nse

to su

pple

men

tary

reco

mm

enda

tions

Supp

lem

enta

ry re

com

men

datio

n G

over

nmen

t Res

pons

e

Chap

ter 3

. Non

-cas

h w

ager

ing

refo

rm

Whe

re p

ossib

le, b

arrie

rs to

bus

ines

ses a

dopt

ing

elec

tron

ic p

aym

ent

met

hods

shou

ld b

e re

mov

ed, i

nclu

ding

for g

ambl

ing

venu

es.

The

Gove

rnm

ent n

otes

this

is an

are

a of

Sta

te a

nd T

errit

ory

resp

onsib

ility

.

The

Gove

rnm

ent e

ncou

rage

s the

Sta

tes a

nd T

errit

orie

s to

cons

ider

w

heth

er th

ere

is sc

ope

to re

mov

e ba

rrie

rs to

ele

ctro

nic

paym

ents

met

hods

in

gam

blin

g tr

ansa

ctio

ns to

the

exte

nt it

doe

s not

redu

ce g

ambl

ing

cons

umer

pro

tect

ions

.

Chap

ter 5

. Int

erne

t Scr

apin

g

Inte

rnet

scra

ping

shou

ld b

e ex

plor

ed a

s a to

ol to

iden

tify

blac

k ec

onom

y ac

tiviti

es o

n th

e in

tern

et a

nd so

cial

med

ia p

latf

orm

s.

The

Gove

rnm

ent s

uppo

rts l

aw e

nfor

cem

ent e

ntiti

es a

nd re

gula

tors

usin

g in

nova

tive

and

effe

ctiv

e to

ols s

uch

as in

tern

et sc

rapi

ng a

nd m

akin

g us

e of

da

ta h

eld

by th

ird-p

artie

s to

iden

tify

blac

k ec

onom

y be

havi

our.

Chap

ter 5

. Fur

ther

opp

ortu

nitie

s fro

m th

ird-p

arty

dat

a su

ch a

s esc

row

The

Gove

rnm

ent s

houl

d al

so k

eep

a co

ntin

ual l

ook

out f

or o

ther

op

port

uniti

es to

acc

ess a

nd m

ake

use

of d

ata

held

by

third

-par

ties.

The

Gove

rnm

ent s

uppo

rts l

aw e

nfor

cem

ent e

ntiti

es a

nd re

gula

tors

usin

g in

nova

tive

and

effe

ctiv

e to

ols s

uch

as in

tern

et sc

rapi

ng a

nd m

akin

g us

e of

da

ta h

eld

by th

ird-p

artie

s to

iden

tify

blac

k ec

onom

y be

havi

our.

Chap

ter 6

. Sin

gle

touc

h pa

yrol

l (ST

P)

The

repo

rtin

g of

wag

es a

nd su

pera

nnua

tion

unde

r STP

pro

vide

s tr

ansp

aren

cy. S

TP st

arts

for e

mpl

oyer

s with

20

or m

ore

empl

oyee

s fro

m

1 Ju

ly 2

018.

The

Gov

ernm

ent h

as a

nnou

nced

it w

ill in

clud

e em

ploy

ers w

ith

less

than

20

empl

oyee

s in

STP

from

1 Ju

ly 2

019.

Leg

islat

ion

will

nee

d to

be

enac

ted

for t

his t

o oc

cur.

An o

ptio

n fo

r the

Gov

ernm

ent t

o co

nsid

er w

ould

be

intr

oduc

ing

the

requ

irem

ent f

or p

aym

ent o

f wag

es in

to b

ank

acco

unts

from

1 Ju

ly 2

019

as w

ell.

The

Gove

rnm

ent a

gree

s and

has

intr

oduc

ed le

gisla

tion

to e

xten

d Si

ngle

To

uch

Payr

oll t

o al

l em

ploy

ers f

rom

1 Ju

ly 2

019

as p

art o

f the

Su

pera

nnua

tion

Guar

ante

e In

tegr

ity P

acka

ge.

As n

oted

in re

spon

se to

reco

mm

enda

tion

3.2,

the

Gove

rnm

ent a

gree

s in

prin

cipl

e to

man

date

the

paym

ent o

f sal

ary

and

wag

es in

to b

ank

acco

unts

, no

ting

the

need

for c

onsu

ltatio

n to

iden

tify

circ

umst

ance

s whe

re c

ash

paym

ents

shou

ld b

e pe

rmitt

ed a

nd a

ppro

pria

te tr

ansit

ions

for s

mal

l bu

sines

s.


41

Supp

lem

enta

ry re

com

men

datio

n G

over

nmen

t Res

pons

e

Chap

ter 6

. Airb

nb a

nd G

ST

The

Gove

rnm

ent s

houl

d ex

amin

e ho

w G

ST sh

ould

app

ly to

acc

omm

odat

ion

prov

ided

thro

ugh

Airb

nb a

nd si

mila

r pla

tform

s com

pare

d w

ith th

at p

rovi

ded

in tr

aditi

onal

hot

els a

nd si

mila

r com

mer

cial

acc

omm

odat

ion.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

It is

impo

rtan

t tha

t bus

ines

ses a

nd in

divi

dual

s mee

t the

ir GS

T ob

ligat

ions

. U

nder

GST

law

, tho

se th

at re

nt o

ut th

eir p

rope

rtie

s in

a sim

ilar m

anne

r to

a ho

tel,

mot

el, i

nn, h

oste

l, or

boa

rdin

g ho

uses

on

an o

nlin

e pl

atfo

rm m

ay

be p

rovi

ding

com

mer

cial

resid

entia

l acc

omm

odat

ion

and

may

nee

d to

ac

coun

t for

GST

on

thos

e sa

les,

whe

re th

ey re

ach

the

GST

turn

over

th

resh

old

of $

75 0

00 p

er a

nnum

.

The

Aust

ralia

n Ta

xatio

n O

ffice

use

s a ra

nge

of d

etec

tion

and

enfo

rcem

ent

stra

tegi

es a

gain

st c

omm

erci

al re

siden

tial a

ccom

mod

atio

n pr

ovid

ers w

ho

evad

e th

eir G

ST o

blig

atio

ns, i

nclu

ding

thos

e w

ho o

ffer s

ervi

ces v

ia o

nlin

e pl

atfo

rms .

Chap

ter 7

. Tra

de d

iscou

nt

To a

cces

s tra

de d

iscou

nts o

n pu

rcha

ses,

bus

ines

ses s

houl

d ha

ve to

pro

vide

th

eir A

BN to

the

selle

r who

mus

t ver

ify a

nd k

eep

a re

cord

of t

he tr

ansa

ctio

n.

They

shou

ld a

lso re

cord

whe

ther

the

tran

sact

ion

was

in c

ash

or c

ard,

and

th

e am

ount

.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

This

will

be

cons

ider

ed a

s par

t of t

he c

onsu

ltatio

n pr

oces

s for

ABN

refo

rms

(rec

omm

enda

tion

4.2)

and

as p

art o

f the

resp

onse

to re

com

men

datio

n 7.

6 on

reco

rd k

eepi

ng.

Chap

ter 8

. Enf

orce

men

t

New

sanc

tions

are

nee

ded

to d

eal w

ith e

greg

ious

and

per

siste

nt

non-

com

plia

nce

to su

pple

men

t our

reco

mm

enda

tion

rega

rdin

g es

cala

ting

sanc

tions

for f

ailu

re to

com

ply

with

reco

rd-k

eepi

ng o

blig

atio

ns.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

As n

oted

in re

spon

se to

reco

mm

enda

tion

8.2,

the

Gove

rnm

ent w

ill

unde

rtak

e a

revi

ew o

f exi

stin

g of

fenc

es w

hich

will

also

con

sider

the

need

fo

r new

bla

ck e

cono

my

offe

nces

.


42

Supp

lem

enta

ry re

com

men

datio

n G

over

nmen

t Res

pons

e

Chap

ter 8

. Res

ourc

ing

for t

he A

TO a

nd F

air W

ork

Om

buds

man

The

ATO

and

FW

O n

eed

to b

e ad

equa

tely

reso

urce

d to

tack

le b

lack

eco

nom

y iss

ues a

nd fo

r enf

orce

men

t act

ivity

to b

e vi

sible

on

the

grou

nd.

The

Gove

rnm

ent a

gree

s in

prin

cipl

e w

ith th

is re

com

men

datio

n.

As n

oted

in re

spon

se to

reco

mm

enda

tion

8.1,

the

ATO

will

und

erta

ke n

ew

appr

oach

es to

thei

r enf

orce

men

t visi

bilit

y, d

ata

anal

ytic

s cap

abili

ty a

nd

com

mun

ity a

war

enes

s.

The

Gove

rnm

ent h

as c

omm

itted

add

ition

al fu

ndin

g of

$20

.1 m

illio

n ov

er

four

yea

rs to

the

FWO

(fro

m 2

016-

17 to

201

9-20

) to

put m

ore

reso

urce

s in

to e

ffect

ive

com

plia

nce

and

enfo

rcem

ent a

ctiv

ities

.

Chap

ter 8

. Use

of e

stim

ates

to v

alue

bus

ines

s tra

nsac

tions

The

ATO

shou

ld c

lose

ly m

onito

r pra

ctise

s suc

h br

oker

s adj

ustin

g bo

oked

ea

rnin

gs to

refle

ct u

ndec

lare

d ca

sh e

arni

ngs o

f bus

ines

ses t

hat a

re b

eing

so

ld, a

nd b

roke

rs sh

ould

hav

e a

posit

ive

oblig

atio

n to

repo

rt c

ases

whe

re

such

adj

ustm

ents

are

requ

este

d. T

he A

TO sh

ould

also

con

tinue

to e

mpl

oy

prox

ies i

n its

com

plia

nce

and

enfo

rcem

ent a

ctio

ns in

the

blac

k ec

onom

y su

ch a

s the

use

of S

mal

l Bus

ines

s Ben

chm

arks

.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

The

Gove

rnm

ent e

xpec

ts th

e Au

stra

lian

Taxa

tion

Offi

ce w

ill c

ontin

ue to

us

e pr

actic

al a

nd a

ppro

pria

te to

ols t

o id

entif

y bl

ack

econ

omy

activ

ities

.

Chap

ter 8

. Cor

rect

def

icie

ncie

s in

the

pros

ecut

ion

proc

ess

Sect

ion

8ZE

of th

e In

com

e Ta

x Ad

min

istra

tion

Act 1

953

shou

ld b

e am

ende

d so

that

an

adm

inist

rativ

e pe

nalty

stan

ds w

here

a ta

xpay

er is

not

foun

d gu

ilty

in c

rimin

al p

roce

edin

gs.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

As n

oted

in re

spon

se to

reco

mm

enda

tion

8.2,

the

Gove

rnm

ent w

ill

unde

rtak

e a

revi

ew o

f exi

stin

g pe

nalti

es a

nd o

ffenc

es w

hich

will

also

co

nsid

er th

e ne

ed fo

r new

bla

ck e

cono

my

offe

nces

.

Chap

ter 9

. Blo

ckch

ain/

dist

ribut

ed le

dger

pilo

t

The

Gove

rnm

ent c

ould

col

labo

rate

with

a la

rge

com

pany

to tr

ial d

istrib

uted

le

dger

tech

nolo

gy a

s a to

ol to

impr

ove

supp

ly c

hain

inte

grity

.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

The

Gove

rnm

ent h

as b

een

wor

king

with

the

FinT

ech

Advi

sory

Gro

up to

ex

plor

e po

ssib

le b

enef

its to

the

econ

omy

from

the

deve

lopm

ent o

f di

strib

uted

ledg

er te

chno

logy

(Blo

ckch

ain)

.


43

Supp

lem

enta

ry re

com

men

datio

n G

over

nmen

t Res

pons

e

Chap

ter 9

. Acc

ount

abili

ty o

f pro

cure

men

t offi

cers

Proc

urem

ent o

ffice

rs sh

ould

be

seen

as r

espo

nsib

le, a

nd b

e he

ld

acco

unta

ble,

for p

rocu

ring

only

firm

s whi

ch a

goo

d re

cord

of c

ompl

ying

with

th

eir t

ax a

nd o

ther

obl

igat

ions

, and

ens

urin

g th

at th

eir s

uppl

iers

adh

ere

to

all s

uch

law

s and

regu

latio

ns fo

r the

dur

atio

n of

the

cont

ract

.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

As n

oted

in re

spon

se to

reco

mm

enda

tion

9.2,

the

Gove

rnm

ent w

ill c

onsu

lt w

ith in

dust

ry to

dev

elop

app

ropr

iate

stan

dard

s for

supp

ly c

hain

pra

ctic

es.

Chap

ter 9

. Sup

ply

chai

n re

port

ing

oblig

atio

ns

The

prop

osed

repo

rtin

g re

quire

men

ts fo

r bus

ines

ses t

o ou

tline

thei

r act

ions

to

add

ress

mod

ern

slave

ry in

thei

r ope

ratio

ns a

nd su

pply

cha

ins s

houl

d be

im

plem

ente

d as

soon

as p

ossib

le.

The

Gove

rnm

ent s

houl

d ad

opt t

he Jo

int S

tand

ing

Com

mitt

ee o

n Fo

reig

n Af

fairs

and

Tra

de’s

reco

mm

enda

tion

to li

mit

gove

rnm

ent p

rocu

rem

ent t

o on

ly th

ose

entit

ies t

hat h

ave

subm

itted

a m

oder

n sla

very

stat

emen

t and

es

tabl

ishin

g an

inde

pend

ent A

nti-S

lave

ry C

omm

issio

ner.

The

Gove

rnm

ent n

otes

this

reco

mm

enda

tion.

The

prop

osal

s in

this

reco

mm

enda

tion

wer

e al

so re

com

men

ded

by th

e re

cent

Join

t Sta

ndin

g Co

mm

ittee

on

Fore

ign

Affa

irs, D

efen

ce a

nd T

rade

’s

(JSCF

ADT)

inqu

iry in

to e

stab

lishi

ng a

n Au

stra

lian

Mod

ern

Slav

ery

Act.

The

Gove

rnm

ent i

s cur

rent

ly c

onsid

erin

g its

resp

onse

to th

e JS

CFAD

T re

com

men

datio

ns a

nd w

ill re

spon

d in

due

cou

rse.

The

Gov

ernm

ent h

as

com

mitt

ed to

intr

oduc

ing

legi

slatio

n to

est

ablis

h a

Mod

ern

Slav

ery

Repo

rtin

g Re

quire

men

t by

mid

-201

8.

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