Questions raised over cash payment limit

Paul Osborne
(Australian Associated Press)


Proposed laws which could land Australians in jail for using more than $10,000 in cash to pay for goods and services are facing a backlash, but are likely to pass parliament.

In the 2018-19 federal budget, the Morrison government announced it would introduce a cash payment limit of $10,000 made or accepted by businesses for goods and services.

Transactions equal to, or in excess of this amount would need to be made using electronic payment or cheque.

The aim of the laws – expected to start from January 2020 – is to tackle tax evasion and other criminal activities.

However, accounting body CPA Australia said while it supported action to crack down on the black economy, “to link all large cash transactions to criminality is a step too far”.

“The proposed offences can lead to an individual being convicted, fined and/or jailed for up to two years for merely using cash, regardless of the purpose or nature of the transaction,” CPA Australia’s Dr Gary Pflugrath said in a submission to the draft bill.

The organisation listed a number of problems with the bill including unnecessarily and unreasonably broad offences, the introduction of vicarious liability into criminal law, a reversal of the onus of proof and insufficient legal defences.

“We believe the policy intent behind this bill would best be achieved by a mix of administrative penalties for breaches and incentives for business to move to electronic payment options.”

One Nation says it will oppose the laws when they come to parliament in the Spring sittings.

“Legal tender is legal tender,” Senator Malcolm Roberts said.

Assistant Treasurer Michael Sukkar said there was clear evidence criminal gangs were using large cash purchases of cars, houses and jewellery to launder money from illegal activities.

He noted there would be no changes to how individuals can withdraw or deposit cash, or how they choose to use their cash when the other party is another consumer.

“For example, if you choose to sell a personal asset to a private individual, such as a car for $15,000, you will still be able to do so in cash. However, if you were buying a car from a car dealer, you would not be able to pay $10,000 or more of the balance in cash,” he told AAP.

Labor frontbencher Stephen Jones said the proposed laws made sense.

“The same part of the economy that fails to pay its workers superannuation, doesn’t pay its tax bills and phoenixes companies to avoid paying creditors are the people who would continue to make cash payments of $10,000 or more,” he told AAP.

“In a day and age where more and more people are paying for their everyday items by direct funds transfer or tapping their phones on an EFTPOS machine, it doesn’t make sense to be defending cash payments of $10,000 or more.”

He said the government should also look at extending the rules to cryptocurrencies, which are often used by criminals and terrorists.


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