Game over for shonks
THE Australian Taxation Office has cautioned two contractors and sacked another working on Gold Coast Commonwealth Games venues for fraudulent business practices.
The ATO last week raided two Gold Coast businesses as part of a crackdown into phoenix activity.
The operators were believed to have been involved in illegitimate “pre-insolvency” practices, helping to promote phoenix activity among clients.
Phoenix activity is where assets are transferred from a company in debt to a new firm to avoid paying employee entitlements, creditors and tax.
ATO deputy commissioner Michael Cranston said at least one construction contractor had been dropped from work on Commonwealth Games sites since the department began scrutinising the deals 12 months ago.
Two other companies have “rectified their practices” and “said they’d meet their obligations”.
“We’ve been doing a lot of work around phoenix for a long time now but we’re changing the way we do things,” Mr Cranston said.
As part of the crackdown, the ATO had worked closely with a number of Commonwealth Games contractors, he said.
“We ask the head contractors to make sure their subcontractors give confirmation that they’re meeting their obligations.
“They might get them to sign something. They may not – they may lie to them – but it’s part of the governance
and sometimes it forces them (to comply). It’s better than doing nothing.
“Employees get hurt, unions hate phoenix, everybody – the tax office doesn’t get paid, other agencies don’t get their moneys.”
A spokeswoman for the Gold Coast 2018 Commonwealth Games Corporation (GOLDOC) said chairman Peter Beattie was happy with how the matter had been handled.
“Whilst the contractors at the Parklands development are not within GOLDOC’s scope, he was comfortable with the way those in question had been dealt with,” the spokeswoman said.
However, the Queensland Government Department of the Commonwealth Games said it could not find any record of any contractor being sanctioned because of phoenix activity.