Michael Andrew, the head of the taskforce, proposes nanochips in $50 and $100 notes so the government knows where the cash is. Cash will expire after a designated period of time.
A plan to strip consumers of their legal protections if they pay in cash and fail to get a receipt has been slammed as “completely unfair” by leading advocacy groups.
The proposal was one of 35 recommendations contained in the interim report from the federal government’s Black Economy Taskforce, which argued the need for “consumer-focused action” to crack down on cash payments.
According to Taskforce chair Michael Andrew, former global head of accounting firm KPMG and current chair of the Board of Taxation, while current anti-black economy laws focused on businesses, consumers are “part of the problem”.
“We intend to examine the merits of consumer focused sanctions, including the loss of consumer protections, warranties and legal rights for people who make cash payments without obtaining a valid receipt,” Mr. Andrew wrote. “This is not simply of matter of imposing new penalties, but part of a wider cultural change agenda.”
But he argued any new penalty regime “should be carefully calibrated”, with the strongest sanctions “applying to egregious behavior or repeat offenses”. “Lighter touch approaches (including ‘nudge’ techniques) will be more appropriate in many cases,” he wrote.
Cash Crackdown Boss Proposes Nanochips Notes
The man charged with cracking down on the “black economy” has revealed how he would like to keep track of your $100 and $50 notes.
Hi-tech nano-chips would be implanted in Australia’s “disappearing” cash under a plan floated by Michael Andrew, the head of the federal government’s Black Economy Taskforce.
Speaking to The Courier-Mail, Mr. Andrew said too much cash was being hoarded under pensioners’ beds and stockpiled as a trusted currency in China.
Estimates for the size of Australia’s so-called black economy vary from $23 billion to $50 billion. The government claims tax avoidance through cash payments costs the budget up to $10 billion in revenue, money that could go towards funding welfare and other services.
In the May budget, the federal government announced an extra $32 million funding for the Australian Taxation Office to fund its cash crackdown, which it expects to bring in an extra $589 million in revenue over the next four years.
According to Mr. Andrew, who will hand down his final report in October, there should be 14 $100 notes for every adult in Australia but there are fewer than that in circulation. While criminals prefer the $50 note, as the Reserve Bank pointed out in its defense of cash last year, foreign migrants and pensioners prefer $100s.
“You could put a trace on some of these notes to see where they would go. You can use nano technology to put little chips in so you could then trace it.”
Last year, a report by UBS recommended Australia scrap the $100 note. According to UBS, benefits may include “reduced crime (difficult to monetize), increased tax revenue (fewer cash transactions) and reduced welfare fraud (claiming welfare while earning or hoarding cash)”.
Reaction to Taxes
Liberal Democrats Senator David Leyonhjelm has the right idea.
“The only people who are distressed by the cash economy are the government and the public servants who want to spend taxes. It’s a reaction to the level of taxes we pay,” said Leyonhjel.
ECB Phases Out €500 Note
India Cash Ban Experiment
On November 8, 2016, India’s Prime Minister Narendra Modi stunned the country with an announcement that 500-rupee ($7.30) and 1,000-rupee notes, which account for more than 85 percent of the money supply, would cease to be legal tender immediately.
The war on cash is moving at breakneck speed.
Mike “Mish” Shedlock