The Australian Taxation Office (ATO) has smashed a significant enforcement milestone, receiving over 300,000 tip-offs from the public about tax evasion and dishonest behaviour since July 2019. This massive community effort is central to the ATO's mission to recover billions of dollars lost to the shadow economy each year.
A Groundswell of Community Action
In the last financial year alone, nearly 50,000 reports were lodged about suspicious businesses and individuals. The total number of tip-offs has now crashed through the 300,000 mark, demonstrating a powerful public stance against financial cheating. ATO Assistant Commissioner Tony Goding emphasised the collective impact of this behaviour, stating, "When someone cheats the system, they’re not just breaking the law, they’re freeloading on honest businesses and the rest of the community."
The data reveals a clear geographic pattern of reports. Residents in New South Wales were the most vigilant, raising close to 16,000 red flags last financial year. They were followed by citizens in Victoria (11,890 reports) and Queensland (10,630 reports).
Cracking Down on the Shadow Economy
The majority of tip-offs relate to shadow economy activities, where individuals and businesses operate outside the tax and regulatory system. Common tactics include demanding cash-in-hand payments for work or deliberately making false expense claims.
"Paying tax is not optional," Mr. Goding asserted. "Sooner or later, and probably sooner, if you’re operating in the shadow economy, the ATO will discover this, through our extensive data-matching." He confirmed that every piece of information received is cross-checked and assessed. The system is highly effective, with around 85 per cent of tip-offs analysed in 2024–25 deemed suitable for further investigation by special ATO teams.
High-Risk Industries and Serious Consequences
The ATO's special investigation teams are focusing their efforts on several key sectors where shadow economy activity is most prevalent. The industries currently in the spotlight are:
- Building and construction
- Cafes and restaurants
- Hairdressing and beauty services
Tip-offs in these areas frequently come from customers, competing businesses, and even employees. In some cases, companies have been reported by their own family and friends.
Mr. Goding issued a stern warning to those considering evading their obligations. "There really is no excuse. It’s unfair competition and it’s illegal," he said. The consequences are severe and extend beyond simply repaying the owed tax. Offenders face significant penalties, interest on unpaid taxes, and potentially even criminal sanctions.
