Taxation Law

Running head: TAXATION LAW
Taxation Law
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TAXATION LAW1
Introduction:
There are no such kind of set definition relating to the sharing economy and there are
numerous terms used to refer to the underlying form of activity such as gig economy, sharing
economy. The final report published by the black economy taskforce have explained the harm
that the black economy causes the business and public, imposing honesty on the honest
taxpayers, damaging the Australian tax reliability and welfare system that creates an irregular
playing ground for most the small business doing the correct thing (Minifie & Wiltshire,
2016). The sharing economy over the years has grown significantly over the years that
facilitates innovation, growth in job and several choices for the customers. During the
discussion, the task force heard that with the sharing economy growth there is an increase in
the risks which the sellers may not be able to pay the correct sum of tax. The underlying of
tax weakens the sharing economy advantage for the customers and companies and forms a
partial playing ground for those that are doing the correct thing.
The ATO has formed an agreement with some of the boards to offer info under the
current data collection powers (Healy et al., 2017). Data collections under the ride sourcing
section has allowed the ATO to take the preventive actions which helps the Uber drivers to
recognize and adhere with their responsibilities. Nevertheless, it requires the adoption of
comprehensive regimes to extensively enhance the compliance under this area.
Current arrangements and promoting compliance with Australian income tax laws:
Presently there is insufficient information and transparency in respect of the taxation
matters under the sharing economy. As a result, ATO faces difficulty in understanding the
whether the sellers are understating their profits, either purposely or because of inadequate
consciousness (Li, 2015). During the consultation process, the taskforce has heard that
insufficient alertness is regularly quoted as the main reason of problem.

TAXATION LAW2
The main motive for the nonexistence of responsiveness is mainly because of sellers
in sharing economy might not be functioning under old-fashioned work relations but as an
alternative the independent outworkers or self-employed principles that falls out of the
current regimes of reporting (Braithwaite, 2017). This implies that the tax might not be
withheld from the earnings that is generated on the platform and the platform might not have
the obligations of reporting the information on the payments that are made to the users to
ATO.
As the sharing economy activities has the informal nature which makes it less likely
that the sellers would be able to understand how such kind of activities might create an
impact on the tax position. The sellers of sharing economy might wrongly consider the
income earned by them from the activities of sharing economy as not assessable since it is a
proceeds from hobby or alternatively they are performing the activities of sharing economy
during the short term or irregularly and hence does not has to pay tax (Findlay & Garnaut,
2017). If the sellers of sharing economy do not know their responsibilities it becomes more
hard for the sellers to obey.
In light of overhead discussion, the ATO has restricted the info regarding the earnings
of sellers in the sharing economy. Such kind of transparency gap among the sellers that are
not familiar with income tax obligations cannot be considered as the desired outcome
(Schneider et al., 2015). Gaps in the current regimes of reporting cannot be necessarily
considered new as it regularly becomes the feature of short term work measures and
arrangements among the private persons relating to the usage of assets. Not like the preceding
decentralised reporting measures, the role of centralised operators implies that it is highly
viable to gather information that are identical to what is gather with the help of current
regimes of reporting. Similar to current regimes of reporting, this would help the ATO to
match the data of reported revenue from the businesses and individuals relating to income