Cash transactions of $10,000 or more will be banned under a black economy crackdown detailed in new legislation. The government has released an exposure draft of a bill that restricts the use of cash and has called for submissions.
The bill, Currency (Restrictions on the Use of Cash) Bill 2019, is in response to a recommendation of the Black Economy Taskforce that the Government take action to tackle tax evasion and other criminal activities by limiting the use of cash.
The key measure of the bill is the introduction of offences for entities that make or accept cash payments of $10,000 or more. The payment can be a single payment or a series of payments relating to one supply.
The explanatory memorandum accompanying the bill says this measure “ensures that entities cannot make large payments in cash so as to avoid creating records of the payment and facilitating their participation in the black economy and undertaking relate illicit activities.”
The cash payment limit is scheduled to take effect from 1 January 2020.
The limit will not apply to transactions where an authorised deposit-taking institution accepts deposits or pays out withdrawals.
The information memorandum says: “Exempting those entities will be necessary for the public to have a legitimate way of moving large amounts of cash into and out of the financial system.”
Foreign currency exchange services regulated under the Anti-Money Laundering and Counter-Terrorism Financing Act will also be exempt.
ADIs and currency exchanges will continue to submit threshold reports when they engage in transactions involving an amount of $10,000 or more.
The bill makes provisions for the Treasurer to specify specific transactions that will not be covered by the limit.
Under the bill, offences are committed regardless of whether the entity intended or was reckless about whether the payment or series of payments included cash that equalled or exceeded the cash payment limit.
If an offence is committed by an unincorporated association or body, the offence is taken to have been committed by each member of its committee of management. Similarly, reach of the partners in a partnership will be liable and the trustee or trustees or a trust will be liable.
If the offence is committed by a superannuation fund the offence is taken to have been committed by the trustee or trustees of the fund. If a super fund does not have a trustee, the offence is taken to have been committed by the entity that manages the fund.