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Australia Bans Payments Over $10k, Unleashes “Mobile Strike Teams” In War On Cash

Courtesy of ZeroHedge. View original post here.

As Australia struggles to maintain its unprecedented 104-quarter-long streak of uninterrupted economic growth, lawmakers are intensifying the country's "war on cash" – ostensibly part of a crackdown on "criminal gangs" that are smuggling drugs and/or people into the island nation and companies that are trying to cheat their taxes.

To wit, Australia's government has introduced an economy-wide payment limit of $10,000 for transactions conducted in cash, which, according to News.au, will help (in the aussie slang) "keep dishonest tradies and businesses from rorting the system by taking cash in hand."

Treasury

From July 1, 2019, cash payments of more than $10,000 made to businesses for goods and services will be banned as the Turnbull Government seeks to crack down on the $50 billion "black economy."

The law was purportedly inspired by instances of large purchases – yachts, sports cars and other luxury items – being made in cash and the tax not being reported.

Perhaps the most – um – striking element of the proposal is the introduction of "mobile strike teams" to catch businesses engaging in the act of conducting an illicit cash transaction.

Treasurer Scott Morrison said the Black Economy Standing Taskforce will be beefed up to detect people making sneaky cash transactions through a rigorous identification system and "mobile strike teams".

A black economy hotline will also be set up to allow people to dob in anyone who may be cheating the system.

"Cash provides an easy, anonymous and largely untraceable mechanism for conducting black economy activity," the response said.

"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."

Meanwhile, Australia's federal law enforcement are setting up a hotline for people to call in and "dob on their neighbors" who are violating the cash payments rule…

A black economy hotline will also be set up to allow people to dob in anyone who may be cheating the system.

"Cash provides an easy, anonymous and largely untraceable mechanism for conducting black economy activity," the response said.

"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."

…And the Australian taxation office is stepping up audits and upgrading its data analysis tools to help catch businesses that violate the law.

It said the taskforce had identified examples of "large undocumented cash payments being made for houses, cars, yachts, agricultural crops and commodities," which contribute to the $50 billion black economy and "hurt honest businesses."

The Australian Taxation Office will also carry out more audits and improve its data analytics in its effort to curb money laundering and criminal activity.

The law is slated to take effect in 2019. After that, transactions involving businesses will need be routed through checks or electronic means. But transactions between individuals and financial institutions.

The government will also overhaul how it handles the Australian Business Register, including possibly imposing more stringent requirements on renewing businesses' operating licenses.

This will be bad news for criminal gangs, terrorists and those who are just trying to cheat on their tax or get a discount for letting someone else cheat on their tax…

It’s not clever. It’s not OK. It’s a crime.

Australian lawmakers have backed the new system, which was introduced by the country's Treasurer, Scott Morrison in his annual speech introducing his proposed national budget.

In its response, the government said it agreed with or supported the majority of the recommendations, including potentially requiring wages to be paid into bank accounts, effectively outlawing cash-in-hand payments. Workers in the "gig economy" will also face greater scrutiny. The government said it was "encouraging the transition to a digital society."

Of course, while the government says its new system is targeted at criminals, we suspect there might be an ulterior motive: Given the rash of foreign investment that has propped up Australia's housing and asset markets, the government is merely trying to stop a flood of capital from leaving the country – particularly now that rising interest rates in the developed world are making its bonds and currency less attractive by comparison.


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