The Australian Labor Party is attempting to force through a vote on phoenixing laws first proposed by the Turnbull coalition government in 2017, in which directors are given identification numbers so that they could be tracked from company to company, making the transfer of assets much simpler to identify.
The Director Identification Number (DIN) proposal had bipartisan support prior to the dissolution of parliament in April.
Shadow Assistant Treasurer Stephen Jones notes that, “Phoenixing is a widespread and corrupt practice, hurting employees, legitimate small businesses, and denying the tax office revenue, costing over $5bn a year.
“Experts agree that the single most effective measure to track dodgy developer phoenix operators is the Director Identification Number.
“There is widespread support for the measure from the Australian Small Business and Family Enterprise Ombudsman, the ACTU, the Australian Chamber of Commerce and Industry, and Master Builders Australia, to name a few. It is the top recommendation of the Regulating Fraudulent Phoenix Activity research project run by Melbourne University and Monash University.”
Australian Small Business and Family Enterprise Ombudsman Kate Carnell is also on record supporting the DIN laws, noting, “The dilemma actually is not whether we do this but how. Everyone supports the director ID number, everyone supports the fact that it would dramatically address our capacity to reduce other inappropriate behaviour.”
Assistant Treasurer Michael Sukkar has said that the Government plans on introducing the DIN laws, as a part of its proposed Modernising Business Registers Program, though the Morrison Government is yet to add it to its proposed list of bills.
With both sides of politics in agreement on the fundamental issue, there is no reason why print business should suffer from phoenixing, which “leaves a bad taste in your mouth” as reported by ProPrint editor Sheree Young in August.
Young explains that, “Printers are regularly burnt by companies that run themselves into the ground and re-emerge with a slight name change or call in the administrators, pay a minimal amount of debt and circumnavigate the whole mess legally.
“The degree of the burn varies but it is still pain for any business, no matter the size.
“Being forced to write off debts from the hundreds of thousands of dollars to a just a few hurts any business. As any printer will tell you once it happens, you can never get the taste out of your mouth.”
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