How diners are exposing a shadow economy and tax cheats
Updated . First published
Diners across Australia are giving authorities thousands of tip-offs on cafés, restaurants and bars they believe may be skirting financial laws, according to the Australian Taxation Office (ATO).
In the past 12 months, the ATO has received 52,000 reports of potential wrongdoing, with many coming from regular Aussies, who are concerned businesses could be evading tax or not paying employees their super, which is contributing to a shadow economy.
Customers and employees are likely to report cafés and restaurants potentially breaking financial laws. iStock
The ATO said they have received a spike in tip-offs concerning food-related businesses in Melbourne, with 2500 reports in the last year concerning the city’s hospitality industry.
Some of the allegations levelled against these businesses are not declaring all income, or demanding or paying for work cash in hand for tax purposes.
ATO Assistant Commissioner Tony Goding claimed the signs of potential financial foul play can be seen both by customers and authorities alike.
“When a venue is packed, staff are flat out and the coffee machine never stops, but the books tell a different story, that’s something we’re going to take a closer look at,” he said.
The ATO is cracking down on hospitality businesses in Melbourne potentially skirting tax and financial rules. ATO
“Aussies know when something doesn’t seem right, and they're increasingly calling it out when they see someone trying to gain an unfair advantage by operating in the shadows,” he added, claiming workers, customers, and competitors were increasingly looking to call out suspected poor behaviour from businesses.
Goding said he understood the current economic climate isn’t easy for businesses, and that in major cities it is a competitive market, but he insisted it wasn’t an excuse to short change customers or employees.
“Those who deliberately avoid paying tax and super aren't just breaking the law, they're undermining honest businesses that are playing by the rules every day,” Goding said.
“We understand many fast food, restaurant and café owners have a lot on their plate, but deliberately avoiding your tax and super obligations isn't the recipe for success.”
The ATO is attempting to crack down on businesses flaunting the rules with Operation Tonberry, which has been triggered in part by the rise in tip-offs centred around Melbourne.
Goding said the investigations would continue, and would also branch out away from hospitality.
“This year Australians most commonly reported businesses in the building and construction, café and restaurant and hairdressing and beauty services industries,” the ATO said in a statement.
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