The Turnbull government’s proposed ban on cash payments above $10,000 is a disturbing breach of our right to privacy, an attack on the basic liberty of free exchange, and will worsen Australia’s red tape crisis. ... In practice, the ban will be ineffective and unenforceable. A transaction limit will not make criminals suddenly law-abiding citizens – they will flout the rules by using multiple smaller transactions and illegal bank accounts with stolen identities.
The ban will, however, prevent the many genuine uses of cash, including keeping transactions private from prying eyes, avoiding credit card transaction fees, and the preference for physical cash over non-material digital currency.
In 1984, George Orwell explored how Big Brother uses surveillance to control citizens. "Always the eyes watching you and the voice enveloping you. Asleep or awake, working or eating, indoors or out of doors, in the bath or in bed – no escape," Orwell wrote.
The intention of the cash ban is to create an accessible digital record of transactions that government can monitor. This establishes a creepy precedent, foreshadowing a future in which you are only allowed to make purchases that Big Brother can watch. If the government should be able to track our transactions why stop at $10,000? Why not $5000? Why not, as some commentators have proposed, $0?
In the long-run, a cashless society would immensely empower the state, which could use our spending habits to reward and punish certain behaviour, or introduce taxes on savings. Imagine a future in which because you spend "too much" on unhealthy food, the government charges you higher taxes; or because you don't have a gym membership you have to pay a higher Medicare surcharge.
Cash is not only an important protection from state power, it also provides privacy from partners and families, and financial institutions and businesses.The Treasurer's Budget Speech referred to measures that
include outlawing large cash payments of greater than $10,000 in the Australian economy.
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.More detail is provided in the statement that
The Government will combat the harm the black economy is doing to honest individuals, businesses and the Australian community. The black economy is a complex, costly and growing economic and social problem covering a range of issues which detract from the integrity of Australia’s tax system.
In response to the Black Economy Taskforce Final Report, the Government is announcing a comprehensive approach to stamping out the black economy, levelling the playing field for all businesses, and changing perceptions that black economy behaviour is acceptable.
New measures include
- increasing the ability of enforcement agencies to detect and disrupt black economy participants.
- removing the unfair advantage black economy participation gives businesses by removing deductions for non‑compliant payments and changing the Government’s procurement procedures to incentivise tax compliance in supply chains.
- consulting on reforms to the Australian Business Number (ABN) system to improve the confidence the community has in identifying who they are dealing with, including development of rigorous new identification systems for company directors (DINs).
- introducing an economy‑wide cash payment limit for large cash transactions of $10,000 to reduce the ability of black economy operators to use cash to avoid their tax and reporting obligations and launder the proceeds of crime.
- providing additional funding to the Tax Practitioners Board to take action against tax agents that facilitate activity in the black economy.
- expanding the taxable payments reporting system to contractors in industries with higher identified risks of not reporting their income.
The Government is also creating an Illicit Tobacco Taskforce which will investigate, prosecute and dismantle organised crime groups operating in illicit tobacco. The taxing point of tobacco will also be moved to when it enters Australia to help starve the illegal tobacco market.