The Turnbull government is establishing a new Phoenix hotline to combat phoenixing activity among directors and companies, which the Printing Industries Association of Australia (PIAA) says is promising for the print sector, but its impact remains to be seen.
Kelly O’Dwyer MP, Minister for Revenue and Financial Services says, "The new Phoenix Hotline will make it easier to report suspected phoenix behaviour directly to the Australian Taxation Office (ATO) so they can pursue those who are doing the wrong thing.
"It will enable timely action to be taken against companies and their directors, safeguarding employee entitlements like wages and superannuation, and ensuring taxes are collected for Government to provide the essential services Australians rely on.”
Andrew Macaulay, CEO of the PIAA says, “We are pleased the Minister is taking action in an area that is damaging to SMEs. It is particularly rife in the print sector and is an issue that has a negative impact in the industry.
“We will be actively supporting and promoting the hotline to our members because they are on the front line and they are the ones who are affected by phoenixing.
“However, the proof is in the pudding. It is easy for the government to say it has a hotline, but we will be watching what action it takes. The government needs to talk to the industry to address the issue moving forward.
“We will be keeping a close eye on the government and its implementation of the scheme. It can make statements but it needs to act.”
[Related: PIAA backs ACCC energy recommendations]
The initiative builds on the work of the government to deter phoenixing, including the introduction of a director identification number, new phoenix offences, new clawback powers for ASIC, the extension of the director penalty regime, addressing corporate misuse of the Fair Entitlements Guarantee Scheme, the establishment of the Phoenix Taskforce in 2014, tougher laws to target the non-payment of superannuation entitlements, as well as reforms to target black economy activities.
O’Dwyer says, "Phoenixing hurts hard working Australians, including the company's employees, suppliers, customers and competing businesses. It causes a significant drain on the Australian economy.
"Last financial year the ATO sent out tax bills totalling more than $270 million from more than 340 reviews and audits of businesses involved in phoenix activity.”
Macaulay says, “When it happens, everyone knows and talks about it. I would not say it happens a lot, but when it does, it is significant.
“Phoenixing does negative things for the industry, firstly, it shrinks margins for other businesses, secondly, creditors and other printers have to absorb losses in their profits and lastly it brings disrepute to the industry, with employees losing super, wages and other entitlements. It has a serious social impact.”
Employees, creditors, competing businesses and the general public can confidentially provide information or report their concerns about possible phoenix behaviour by calling the Phoenix Hotline on 1800 807 875 or online at the Australian Taxation Office website. The government says disclosures will be protected by privacy laws and legislative action in protecting whistleblowers.
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