Self-Employed Australia

Gig workers alert – ATO tracking your income

April 28, 2023 by Self-Employed Australia

This is to alert SEA members and subscribers about new laws affecting you if you earn income through ‘gig’ platforms. As of 1 July 2023, the platforms will be required to report your income to the Australian Taxation Office. The move is directed to identifying undeclared income and will eventually apply to GST compliance.

Legislation for the Sharing Economy Reporting Regime passed Parliament in December 2022. The ATO is having to design the implementation of the new laws quite quickly. The ATO is seeking to implement this properly and is conducting industry and ‘stakeholder’ consultations on this. We’re involved in these consultations and have raised a number of issues.

To give you some context, the new reporting rules are targeting the (approximately) 970,000 people, or 7 per cent of the workforce of 13.9 million, who earn income using gig platforms. Only 0.19 per cent of the workforce, however, report earning all their income from gig. That’s according to the comprehensive inquiry into gig work done by the Victorian government.

Consequently, the ATO’s gig income reporting regime is overwhelmingly going to affect people who use gig as top-up income. If you’re using gig for income, you’ll need to ensure that you’re reporting that income correctly.

The issues we’ve raised in the consultation so far include the following:

Data collection: The gig platforms will be required to report data other than simply financial—mainly, we’re told, for identification purposes. We asked if the type of data required could be clarified.

GST: How will GST reporting operate? Will gig platforms be required to understand gig workers’ GST threshold limits?

Gross or net income: We assume that reporting will require net income declarations. That is, income after platforms take out all platform and related expenses.

Dispute management: This is our top query.

What if a platform incorrectly reports income or reports income that does not match the ATO’s prescriptions?

Our concerns here are strongly linked to the abuse of social welfare recipients in the Robo Debt scandal. In that case the ATO provided income data to Centrelink which then used that data to allege incomes that were false. The government’s dispute-resolution process was essentially non-existent, resulting in huge abuse of welfare recipients. The same potential exists with this new reporting system—namely, if there are reporting errors, then the gig worker is hopelessly disadvantaged in having them investigated and fixed.

We have to say that the ATO was/is very receptive to our concerns and queries.

If you earn income through gig, we’re keen to hear from you if you have concerns or can identify issues. Drop a line to me (Ken Phillips – kennethnormanphillips@gmail.com)

You can read more from Ken Phillips on his Substack Self-Employed Aren’t Stupid site, including ‘A tale of 2 Croissants.’

Self Employed. Marxism. Corruption. Not Above The Law

April 23, 2023 by Self-Employed Australia

At Self-Employed Australia we’re covering what seems to be a wide range of topics. In fact, these all come back to a central ‘thing’ that we seek to protect—namely, your right to be self-employed should you wish. That is, your right to Be Your Own Boss.

One of our great supporters is Discernable, an on-line blog television channel run by Matt Wong. Matt’s a true self-employed, small business innovator. He’s invested his own money, time and effort to pursue a vision that says that media news and issues coverage doesn’t have to be slogan-slamming but can undertake patient, intelligent coverage of issues.

If you haven’t watched Discernable we highly recommend doing so. If you’re like us, you’re likely to find the long (frequently 2 hour) interviews engaging, addictive and binge-watchable. The stories that come from Matt’s guests are fabulously insightful.

Matt has interviewed SEA’s Ken Phillips on several occasions covering our Not Above The Law campaign and more. Just this week Matt interviewed Ken and SEA chairman Nick Karamouzis.

The interview is available here.

We covered a range of topics. And to make it easy for you here are the timeslots of the issues we covered.

We trust our interview gives you a good handle on our campaign efforts.

Reporting from Marxism Conference 2023

April 13, 2023 by Self-Employed Australia

We’ve reported that the Albanese government has committed itself to upending our right as self-employed people to be self-employed. Its stated agenda is to create a third definition of self-employment called ‘employee-like.’ This will throw into confusion, perhaps even remove, key protections we have long campaigned to achieve—for example, protection from unfair contracts.

The government plans to move with legislation later in the year. We intend to mount a strong campaign against this and are preparing for the battle ahead. The government comes at its agenda from the perspective that there is an inherent conflict between ‘workers and bosses’. This is the old Left-wing perspective of the social and economic order.

The challenge posed by self-employed people to this perspective is that we are both worker and boss at the same time. So, do we exploit ourselves? Are we inherently in conflict with ourselves? Um … confusing!!

Over Easter, Australian Marxists held their Marxism Conference 2023 in Melbourne. Self-Employed Australia’s Executive Director Ken Phillips attended the full three days. His aim was to seek to understand what the Marxists’ arguments are and the world view that underpins them. If we are to effectively defend the right to be self-employed, we need to understand what the ‘other side’ are saying and thinking—even at the furthest end of the spectrum.

The Albanese government is broadly of a Left-wing persuasion. Prime Minister Albanese is from the socialist left of the Labor Party. We’re not offering a view on that, but rather seek to understand a range of political views. All political views fit somewhere along a spectrum of some sort. We don’t know where the PM sits on the Left-wing spectrum. We doubt that he is a hard-line Marxist as presented at the Easter Marxism Conference.

What we have done, however, is to put together some day-to-day reports on what we think it is that Australian Marxists believe. Here are the three reports we put together over Easter:

Reporting from the Marxist Front Line – Overview and agenda

Listing the agenda items.

Reporting from the Marxist Front Line – Day One

Capitalism is the enemy.
We are defined by our class.

Singing “the Internationale”

On War and Identity Politics

We have genuinely attempted to present reports of what was said and what was argued. We’re not commentating on those claims. Rather, we’re simply trying to gain a broader understanding of the mind of the Marxist Left.

‘A Tale of 2 Croissants’ and Being a Little Bit Pregnant(?)

April 5, 2023 by Self-Employed Australia

I let you know a little while ago that I’ve started posting as a Substack writer. Substack is for obsessive writers (like me). I’ve called my Substack SELF-EMPLOYED AREN’T STUPID!

Substack gives me a platform to write about self-employed issues, ideas, concepts and thoughts that complement what we do at Self-Employed Australia.

So here are some thoughts that might interest you from SELF-EMPLOYED AREN’T STUPID!

A tale of 2 croissants

I explain that:

“In my home city of Melbourne there’s a near-inner-city suburb that’s rapidly changed from working-class to ‘woke-well-to-do’ class. At the outer edge of the suburb there’s one street that seems to divide the two classes. On the working-class side of the street is a popular bakery run by a Vietnamese family. Not quite half a kilometre away (in the woke-well-to-do section), is another bakery.

The Vietnamese bakery sells croissants for $4.00.

The woke-well-to-do bakery sells croissants for $6.50.”

A serious look at being a ‘little bit pregnant’

This article looks at the labour academic argument that self-employed people can be a ‘little bit an employee’. I explain that:

For a long time, Australian unions, labour academics and their political fellow travellers have sought to cut away at the right of people to earn their income through the commercial contract. The Albanese government has committed to doing this later in 2023.

And explain the history and thinking around this idea.

Independence and the Death of Employment

You may not be aware that I published a book on this in 2008. I’ve decided to make this available through Substack in serialised, chapter format. I’ll progressively release chapters. In this first release I provide the book’s Introduction. In it I quote Roman Emperor Caligula who stated:

“Bear in mind that I can treat anyone exactly as I please”. That’s real power.

The modern employment contract is a contract of control and power, of one party over another. Few realise this. And much of my (obsessive) journey is to argue against such power and control.

As you are a subscriber to, or member of, Self-Employed Australia, you’ve become part of, or maybe are committed to, the campaign to defend self-employment—that is, escaping the control and power over you that comes with ‘employment’.

I invite you to subscribe to my Substack SELF-EMPLOYED AREN’T STUPID! blog and join me on the further development of this journey.

We give evidence on Tax Fairness solution to UK Parliamentary committee/group

March 12, 2023 by Self-Employed Australia

For over a decade we’ve been campaigning for fairness and for rule of law principles to be applied when the ATO assesses and administers alleged tax debts, particularly those of self-employed, small business people.

We have found a template ‘solution’ based on how USA law requires tax administration fairness from the IRS. Here’s a video explanation and a one-page summary.

It transpires that the UK also has very similar problems with its tax administrator (HMRC) abusing self-employed people. We have a long-standing campaigning partnership with Contractor Calculator in the UK who, like us, campaigns for tax administration fairness. The UK problem is so severe that an all-party parliamentary group/committee has been formed to seek a solution to HMRC abuse. Some 250 UK MPs are in the group/committee.

Last month (on 21 February) we gave a joint presentation to the Taxpayer Fairness Group’s senior parliamentary members. We offered them a vision of a solution based on the USA model which we also recommend for Australia. Three of us gave presentations followed by Q&A (YouTube links below).

Jason made some strong points:

“At the core of this is whether governments exist to serve people or citizens exist to serve government … we have provided tax agencies in the Western world with extraordinary powers that are in breach of some pretty fundamental legal rights…”

We provided the UK parliamentary group with:

Almost exclusively, tax debates are about how much money is or should be taken out of which pockets of the people. But the way tax laws are administered cuts to the heart of the power of government over the people. And by ‘government’ we mean the faceless tax bureaucrats who administer the inevitable maze of tax laws.

Tax law administration must be subject to transparency, accountability and checks and balances so that the rule of (tax) law applies in a practical way. That is not the case in Australia nor, it seems, in the UK.

Our campaign is to secure that rule of law. The US model offers a practical template for reform.

They say there’s “trouble Down Under?”

March 7, 2023 by Self-Employed Australia

The speed with which Australia’s fundamental operational structures are being changed is quite breathtaking.

At the beginning of February, the Federal Treasurer, Jim Chalmers, released a ‘thought’ article where he announced “…the beginnings of a new economic model” by creating “…a new values-based capitalism for Australia”. This embodies a surprisingly radical intent, even given the tradition of the labour movement’s ambitions over the last 50 years.

On my thesis, ‘The New Australian Socialist Experiment’ (also released in February), I saw Chalmers’ declaration as part that emerging experiment. What I hadn’t expected was the rapid rate at which this new agenda unfolded, became apparent and ignited a vigorous debate.

Gary Banks was the head of the Productivity Commission from 1998 to 2013. The Productivity Commission is the major government-funded ‘think tank’ that looks at, and reports on, how to make Australia efficient and productive. Normally any criticism by such government bodies directed at government (even by retired heads) is cautious, using toned-down bureaucratic language. But this week Gary Banks came out swinging.

In a damning assessment of the current policy direction Banks referred to “…policies that have damaged our economy’s ability to cope with change, to be competitive and support economic growth.” He refers to “monumental bungling”, policies that are “…contrived to maximise the cost…” and “…we [Australia] have been busily eliminating our competitive advantage…”

Gary Banks’ criticism is directed at all governments, not just the current federal government. What is significant is not simply his criticism of specific policies, but the unexpected tone of his criticism. He is flagging an Australian structural, self-created, economic downslide.

Banks’ blunt warning comes just as many retirees are reeling in shock at unexpected significant changes to superannuation tax rates. While the proposed tax regime only appears to affect ‘rich’ people, those changes also signal that using superannuation for retirement is now much more risky. Is this the beginning of the end for superannuation?

To us (SEA), it’s not just what’s already happened that’s caught our attention, but what seems to be pending. There are tea leaves to be read!

There is broad media reporting of a rental crisis. But emerging policy seems to be pushing housing rental supply in a negative direction. One much-touted ‘solution’ is the imposition of rental price controls and rent freezes.
Influential, wealthy unions are supporting and calling for price controls—not only on energy but, seemingly, more broadly as well.
State workers’ compensation schemes are in financial crisis, unable to fund their obligations.

Our experience is that when this sort of media coverage starts happening it’s usually followed by new regulations to ‘solve’ such problems.

And we know that the policy knives are out to harm self-employed people. We reported in February on just one agenda item designed to kill off independent truck drivers.

Over the next few weeks we’ll try and put together analysis of these issues and more. Things are certainly moving at a rapid rate!

Outcome: Victorian Supreme Court Action

January 20, 2023 by Self-Employed Australia

This is a special email to update you on the outcome of our mandamus application to the Victorian Supreme Court over WorkSafe Victoria’s failure to prosecute individuals and entities over the 2020 Hotel Quarantine disaster.

On 2 December 2022, we informed you of the Court’s ruling (delivered that day) which declared that we had not lodged our application ‘on time’. That is, our application was dismissed on a technicality. We disagree with and reject this decision.

For fuller details on the case:

This link is to the ruling of 2 December. We’ve highlighted some sections.
This link gives an overview of the 3-year campaign, plus some commentary on the ruling.
We have made available a full commentary on the ruling to SEA members.

Here’s a summary

Supreme Court rules require that lodgement needs to occur within 60 days of when the named government department failed to do what that department is required to do by law. The issue was: what was that date?

WorkSafe refused to answer whether they had investigated those named entities as required. But the ruling states that, as of 29 September 2021, we should have inferred, concluded or assumed that WorkSafe had investigated all the 26 entities/individuals that we named (the Victorian Premier, etc). (Our application was lodged on 14 February 2022.)

We say that that conclusion is wrong and that we did not and could not have known. The Court’s ruling was based on interpreting drawn-out correspondence spanning many months about who said what to whom and what we should have inferred by what was said/written.

The ruling then does two curious things in our view.

It spends considerable time rebutting many of our published allegations/assessments we made as to why individuals/entities should be prosecuted. Why bother to do that when the dismissal of our application on technical grounds was all that was needed? The ruling reads as a defence of the government individuals and entities we named.
The ruling then says that if the court allow SEA’s application that this would put the individuals we named under ‘stress’ and this should not occur.

It seems that the Court is saying that an individual should not be prosecuted for alleged offences if the prosecution were to cause the individual ‘stress’. We ask: Would this principle apply to an accused murderer? That is, should an accused not be prosecuted because they would feel ‘stressed’? We find this a disturbing concept. We will have more to say on this issue.

SEA is committed to continuing our ‘Not Above the Law’ campaign, along with our other campaigns on public policy issues affecting self-employed people and more.

I’m available to chat should you want more information or explanation.

Ken Phillips
Executive Director, Self-Employed Australia
0412 393 692

ATO watchdog to be closed down/neutered?

December 19, 2022 by Self-Employed Australia

If there are two things to be learnt from the current Royal Commission into the Robodebt scandal, it’s that governments can and do ‘get it wrong’ and that governments can and do inflict massive harm on individuals.

In the Robdebt affair the Australian Taxation Office supplied the income data of tens of thousands of welfare recipients to Services Australia, the federal government’s welfare department. The data was misused by Services Australia resulting in up to 200,000 people who didn’t owe the government anything being hounded by the department over incorrectly assessed debts. The scheme was illegal but the department pushed ahead anyway.

Some might say that the Royal Commission is political payback by the Albanese government against the Morrison government. That’s nonsense. The inquiry is an important investigation into how government can ‘stuff up’ even while claiming to be acting in the public interest. Lessons must be learnt, and remedies implemented to limit the misuse of government power over individuals.

That’s why we are deeply concerned to read media reports of a push to dismantle the independent ATO watchdog, the Inspector-General of Taxation and Taxation Ombudsman. The Tax Ombudsman is a small federal government department that is legislatively charged with investigating complaints against, and reporting on the performance of, the ATO.

In our view the ATO hates this oversight because it creates some measure of transparency. The ATO has a powerful media unit that pumps out stories about how perfect the ATO is. But we know that the ATO gets things wrong on too many occasions. Take this one example.

In the Robodebt Royal Commission the ATO has given evidence that the ATO remained silent about the illegality of the Robodebt program in order to protect the Human Services Department (Services Australia) from adverse publicity. The ATO wanted to show solidarity with other government departments. In fact, the ATO should have spoken up, but they didn’t. This is what happens in governments.

Good public servants will often see the protection of the institution as more important than the protection of ‘the people’, even when government inflicts harm on the people. On the other hand, public servants can have their lives destroyed if they tell the truth. Look at the treatment of ATO whistleblower Richard Boyle.

Governments need to have strong internal watchdog departments. This is what the Taxation Ombudsman does. The Ombudsman has a legislative charter to watch the ATO. Such internal watchdogs act as early warning radar systems. They make for better, more transparent government. They reduce the ability of government to harm ‘the people’. Who knows? A Services Australia watchdog might have prevented the Robodebt scandal.

We’re writing to the Prime Minister and others to ask for commitments to retain the Taxation Ombudsman. In fact, we’re asking for reform and an increase in the Ombudsman’s powers. A parliamentary committee last year recommended just this. Read our summary ‘One Giant Step for Taxpayers – ‘Taxpayer Rights’.

Victorian Labor promises to destroy gig work and self-employment

November 21, 2022 by Self-Employed Australia

In late October this year the Victorian Labor Government announced new gig laws it intends to introduce. The promised laws have all the nice-sounding language of ‘rights’ for gig self-employed people, but in fact the laws amount to a stripping of rights.

We’ve seen this sort of cunning stuff before. In California, in 2020, new laws came into effect that outlawed the use of self-employed people. That is, the structure of the laws didn’t ban people being their own boss. But by making it illegal to use self-employed people, California destroyed the incomes of people who worked as their own boss.

The promised Victorian Labor laws would perform a similar underhand trick. Effectively the laws would impose huge union control and centralised regulation over gig platforms, thereby destroying their business models. The platforms would become unprofitable and be forced to leave Victoria.

This is why Deliveroo recently closed in Australia. They’d done deals with unions that made their business unviable. Close down was the answer!

And who suffers? Yep, you got it. It’s the thousands of self-employed people—try students, retirees and the rest—who use gig platforms to top up their income. Only 0.19 percent of gig workers use gig for their full-time work. Everyone else uses gig for income top-up.

The promised Victorian Labor law is a business destroyer. It’s a policy that says that Labor despises people who work as their own boss, working when they want to work. It’s a policy of hate toward small business people.

We saw this before in Victoria when, around 2017, the Victorian Labor Government forced the breaking of the contracts of hundreds of self-employed cleaners who had direct contracts to clean schools. Labor forced these ‘own boss’ cleaners out of business and handed the contracts to big business. Cleaners were forced to become union members or have no work.

The promised Victorian Labor gig destruction laws would:

Force gig platforms into industrial-style ‘negotiations’ over how they manage their business and what the terms of their contracts are. This process would give unions power over gig platforms and gig workers.
Force gig platforms to change their contracts.
Destroy the entire concept and practice of ‘offer and acceptance of contract’ which is the core fundamental of commercial activity.
Impose pay rates.

And more.

In effect, self-employed gig people would retain their theoretical ‘right’ to be self-employed. But gig work and income would simply disappear. This is a Labor policy that attacks the ability of low-income people to find income through being their own boss. It’s pretty disgusting!

This commentary should in no way be construed or taken as an endorsement (or otherwise) of any political candidate or party or as a suggestion as to how anyone should vote or not vote at the 26 November Victorian state election.

Why we do what we do. No-one should be above the law

November 13, 2022 by Self-Employed Australia

As I was leaving the court at the close of our most recent Victorian Supreme Court hearing on 4 October over the 2020 Hotel Quarantine debacle, I was asked by a journalist, “why do you do what you do?”

The journalist was observing that, in taking on WorkSafe Victoria, we are taking on the might of the Victorian government. Further, there is no personal gain to be had for anyone at Self-Employed Australia in doing this. In fact, some would argue that in doing so, there may be all sorts of personal risks. And the court action consumes substantial resources with frequently very stressful work. The journalist was curious as to our motivation.

The answer is simple. In an (allegedly) democratic country constrained by the rule of law, no-one is or should be above the law. We are fighting, as best we can, to have that principle of democracy applied in practice. Democracy and the rule of law should not simply apply on election days, but be the living experience, every day, that guides our communities.

It’s like this. Governments make rules that apply to everyone. But far too frequently government excludes itself from those same rules. This happens when legislation specifically removes government from the reach of the law. It also happens when government institutions which regulate and enforce the law fail to, or (worse) refuse to, apply the laws in order to protect themselves or others.

Perhaps one of the greatest historical and enduring battles of human organisational effort is to decide the proper role of government. There are perhaps two broad aspects to the battle.

Some assume that government (by its nature) is always good, always pure and should reign supreme. Further that private enterprise is always evil because of the profit motive. (Yes, this simplistic view was passionately put quite recently in an online consultation I attended with a large government-funded think-tank!)

The counter-argument often put is that government is the source of oppression and must be constrained, reduced and curtailed.

The truth I think, is sandwiched between the two views. There is nothing holy or sacred about either government or private-sector operations. There is just the reality of human behaviour in which both the best and worst of human instincts play out against each other.

The resolution of this problem must be that we have laws that apply equally to everyone. The practices of transparency and accountability must be embedded in law and apply whether individuals work in government or the private sector.

Too frequently, however, government writes itself out of the rules that are written for everyone else, most notably the private sector.

Take this example. This Wednesday past (9 November) beefed-up laws giving protections from unfair contracts came into effect. That’s fabulous. But get this: The laws don’t apply to government departments. So a government department can, for example, engage an IT contractor but impose an unfair contract upon them. A bank cannot do the same thing. The hypocrisy is monumental. It debases the rule of law.

Another example. The ATO recently took submissions reviewing its policy for how it treats taxpayers. But these rules don’t have the force of law. Hypocrisy again. In our submission we challenged the ATO to seek to have parliament pass legislation to enshrine the fair treatment of taxpayers in law.

Our campaign to have the Victorian WorkSafe Authority prosecute individuals and government departments for OHS breaches over the 2020 hotel quarantine debacle, is a campaign for the rule of law. No-one should be above the law. (In case you’ve been following this matter, we’re still waiting for the court ruling.)

Ensuring that these simple principles of transparency and accountability apply equally to everyone is what motivates us. After all, self-employed people are always held accountable for what they do. Perhaps this is why we’re so passionate about equality of accountability.

We’ll have more news soon.