Construction under scrutiny

If you work in the construction industry – and particularly if you are likely to work on the Gold Coast Commonwealth Games sites – you should be on high alert.

The Australian Taxation Office (ATO) has announced that it will be looking closely into the tax affairs to contractors working on the Commonwealth Games sites to ensure that the project is free from business rorting.

“Whilst most businesses do the right thing, the ATO has found that building and construction is one industry where we see too many phoenix businesses,” said Deputy Commissioner Michael Cranston.

“Given the large number of contractors working on Commonwealth Games construction sites, it?s a good opportunity for us to identify those who might be trying to rort the system.”

According to the ATO, phoenix activity (the deliberate liquidation of a business to avoid paying debts) costs the Australian economy $3.2 billion each year. Honest businesses suffer the most, losing almost $2 billion in unpaid debts and the non-supply of purchased goods and services.

“Phoenix operators create an unfair market advantage for themselves by deliberately liquidating companies to avoid paying creditors and then setting up new entities to carry on the same business. This means they can undercut their competitors,” said Mr Cranston.

New Drug Testing Regime for Construction Sites

As well as having additional focus on their finances, construction workers will also have an additional focus on their health, with the federal government making changes to the Building Code to require drug and alcohol testing on construction sites subject to the Code.

“Safety is a paramount consideration on construction sites.  It is simply an unacceptable risk to the health and safety of employees and the public to have workers affected by drugs or alcohol on construction sites,” said Minister for Employment Senator Eric Abetz.

“The Government is committed to the Building Code to ensure taxpayer funded sites operate safely and efficiently, and projects are delivered on time and on budget.”

Responding to the Code change, the Master Builders Association said it welcomed the change.

“Safety on construction sites is paramount for the wellbeing or workers, contractors and the community and the prevalence of drugs including Ice on building sites poses unacceptable risks,” Wilhelm Harnisch CEO of Master Builders said.

“Master Builders has consistently called for compulsory drug and alcohol testing to protect the health and wellbeing of all parties on building sites and their families.”

“Contractors who are subject to the Building Code will have 28 days to ensure they have a compliant drug and alcohol testing policy in place. Compliance will be enforced by the independent construction industry regulator Fair Work Building and Construction ensuring that safety will be maximized with minimal unnecessary disruption to building sites.”