THE Australian Small Business and Family Enterprise Ombudsman, Kate Carnell today welcomed Labor’s commitment to establish a free legal advice service for small businesses and farmers in dispute with financial service providers.

“Through this initiative, small businesses and farmers would get free legal advice as soon as a dispute arises,” Ms Carnell said. “This service would continue to provide legal advice if the dispute is escalated to the Australian Financial Complaints Authority (AFCA) or is taken to court.

“Small businesses and farmers would also be able to call on this advice to prepare for past cases to be considered by AFCA under its extended remit – to consider eligible financial complaints from small businesses dating back to January 1, 2008.

“We support measures that ensure small businesses have access to justice, particularly in cases where there's an imbalance of bargaining power.

“The court system is expensive and is extremely time-consuming; money and time are two key things that small business owners don’t have," Ms Carnell said.

“Phase I of our Access to Justice Inquiry found three out of five small business owners sought legal advice from a lawyer. Even with legal advice, small businesses find the cost of any action to achieve justice outweighs the potential gain.

“The proposed initiative would have the ability to actually fund cases, which is a real step to achieving justice for small businesses and farmers with valid cases against their financial service providers.”

www.asbfeo.gov.au

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CONSUMERS will once again be left vulnerable to raids on their super accounts by financial advisers if a government proposal to allow grandfathered conflicted remuneration to continue goes ahead, according to Industry Super Australia.

Industry Super Australia has strongly opposed the move in its submission to the Exposure Draft Treasury Laws Amendment (Ending Grandfathered Conflicted Remuneration) Regulations 2019.

Despite a clear recommendation by the Royal Commission that grandfathering arrangements should cease, the government’s draft regulations effectively give an exemption for financial institutions to continue provisions for conflicted remuneration by allowing a rebate or monetary benefit scheme to be established.

Industry Super Australia chief executive Bernie Dean slammed the proposal and called on the provisions for conflicted remuneration to be repealed as soon as possible – "in line with Commissioner Hayne’s recommendation".

“Let’s not forget that grandfathered commissions remove money from consumers' accounts without their express consent. This is akin to stealing money,” Mr Dean said.

“This is money that would otherwise have been maintained, in a consumer’s account, and instead was siphoned off to pay financial advisers for nothing.

“To claim administrative inconvenience as an excuse to try and water down what should be a blanket ban on grandfathered commissions, is astounding given the disgraceful conduct that was exposed during the Royal Commission.”

Mr Dean said this was not the first time the retail fund sector had tried to persuade the government – previously through the FoFA legislation – to put in place a backdoor arrangement that would have seen grandfathered commissions allowed into perpetuity.

“While some parts of the super sector will fight tooth and nail to keep grandfathered conflicted remuneration provisions – at the expense of consumers – our position is clear," Mr Dean said.

“We do not support a watering down of the blanket prohibition on grandfathered commissions. Any attempt to provide exemptions for conflicted remuneration will only erode consumer protections and leave consumers worse off.”

Industry Super Australia’s full submission can be found at https://www.industrysuper.com/media/ending-grandfathered-conflicted-remuneration/

THE Queensland Resources Council has urged the Palaszczuk Government to focus on moving the multi-billion-dollar pipeline of resource sector projects from planning to purpose.

QRC chief executive Ian Macfarlane said while he welcomed the Government’s advertisement promoting the fact $20 billion worth of resource projects had been approved with the creation of 7000 jobs over the last four years, there was in excess of $60 billion of resource project investment in the pipeline.

“We are competing with the world for investment in the development of our resources -— coal, gas and metals. Our resources are first class. We have dedicated and skilled workers. We need the confidence that stable policy settings from government gives to secure the new projects and new jobs for Queensland,” he said.

“It’s great to celebrate the investment secured over the last four years, but no one won a race running backwards. We are in a race — commodity prices and demand is strong.

“Abrupt and unpredictable government policy and decision-making from government is our biggest threat.

“With Queensland’s unemployment rate now back over 6%, there is no better time to give the resources sector the renewed confidence to invest, employ and export for all Queenslanders.”

Mr Macfarlane said since the 2017 State election, full-time equivalent jobs in the Queensland resources sector had grown at the rate of one every 57 minutes.

www.qrc.org.au

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THE Australian Taxation Office (ATO) is collecting bulk records from Australian cryptocurrency designated service providers (DSPs) as part of a data matching program to ensure people trading in cryptocurrency are paying the right amount of tax.

Data to be provided to the ATO will include cryptocurrency purchase and sale information. Deputy Commissioner Will Day said the data will make up a key element in the ATO’s compliance program.

“The ATO uses third party data to improve the integrity of the tax system by identifying taxpayers who fail to disclose their income details correctly," Mr Day said. "We also use third-party data to assist taxpayers in meeting their tax obligations through pre-filling of tax returns.

“This data will be collected under notice from the DSPs on an ongoing basis,” he said.

There has been significant growth in participation of crypto-assets in recent years. It is estimated that there are between 500,000 to one million Australians that have invested in crypto-assets.

Cryptocurrency and blockchain technology is seen as an enabler of existing risks for the ATO. Cryptocurrency has been used to move funds within the black economy, hide money offshore, and is sometimes linked to risks with unexplained wealth and undeclared taxable capital gains.

The ATO will be working with other regulators, in particular the Australian Transaction Reports and Analysis Centre (AUSTRAC) and the Australian Securities and Investment Commission (ASIC) to ensure that tax law requirements align with a whole of system approach.

“The ATO is also working in a joint international effort as part of the Joint Chiefs of Global Tax Enforcement (J5), aimed at investigating cryptocurrency-related tax evasion and money laundering,” Mr Day said.

Following the data matching exercise people may be contacted by the ATO and given the opportunity to verify the information collected, before any compliance action is undertaken. People will be given at least 28 days to clarify any information that has been obtained from the data provider.

“We want to help taxpayers to get it right and ensure they are paying the correct amount of tax,” Mr Day said.

“Where people find that they have made an error or omission in their tax return they should contact the ATO as soon as possible. Penalties may be significantly reduced in circumstances where we are contacted prior to an audit.”

People can correct a mistake by requesting a self-amendment or making a voluntary disclosure, and can also contact us if they need help paying their tax.

Details of the ATO’s data matching strategies are published at www.ato.gov.au/datamatching

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