Tip-offs fell by almost 20 per cent, to 43,000 from almost 53,000 in 2020–21, and ATO Assistant Commissioner Peter Holt said the withdrawal of pandemic support was the reason.
“Tip-off numbers decreased to 43,020 during the 2021–22 (financial year) because the previous yearly volumes were inflated by COVID-19 related tip-offs,” said Mr Holt.
“COVID-19 related tip-offs included possible fraud about JobKeeper, early release of superannuation and other COVID-19 measures managed by the ATO.
“Since March 2020, we received approximately 20,000 COVID-19 related tip-offs.”
Concerns over pandemic support fraud boosted tip-off numbers throughout COVID, with 2019–20 recording 56,292 calls and emails to the ATO.
Mr Holt said that despite the fall, the numbers were simply returning to normal levels.
“Yearly volumes are expected to be between 40,000–50,000 tip-offs per year,” he said.
The most common tip-off concerned the shadow economy, said the ATO.
The shadow economy – previously known as the black economy – refers to activities that take place outside of the tax and regulatory systems.
The ATO estimates that it misses out on approximately $11 billion in taxes each year as a result of it.
“The shadow economy is an economic and social issue that affects us all,” said Mr Holt.
“As businesses recover from the impacts of COVID and natural disasters, it is more important than ever to protect the vast majority of businesses who are honest and try to do the right thing.
“Every dollar of tax dodged is a dollar that can’t be used for vital services like health and aged care.”
The ATO said the industries it was informed about most were building and construction, hairdressing and beauty services, and cafes and restaurants.
NSW recorded the most dobbers, with more than 13,400, followed by Victoria and Queensland with 11,500 and 9,200 respectively.
“We get tip-offs from other businesses, customers, members of the public, even employees,” said Mr Holt.
“If these businesses think they can continue to hide in the shadows and not pay their fair share of tax, they are mistaken.
“It’s not a matter of if the ATO will shine a light on this behaviour, it’s when.”
The move to a more digital economy during the pandemic, with people encouraged to use cards rather than cash, had failed to stop the shadow economy according to the ATO.
“There’s a bit of a myth that COVID has ‘fixed’ the shadow economy because people are using less cash,” said Mr Holt.
“While this may be true for some businesses, we know there is a lot of cash in circulation and it is being used in the shadow economy.
“Just because digital payments have increased in popularity, this doesn’t mean that the shadow or cash economy has disappeared, it’s still there and we’re determined to shine a light on it.”