Tasmanian business raided by Australian Federal Police, Taxation Office as part of global sting

A Tasmanian business has been raided by the Australian Federal Police as part of a sweeping international crackdown – and it could be facing an eye-watering fine.

A Tasmanian business suspected of using illegal software to reduce its tax bill has been raided by the federal police and tax officials as part of a sweeping global sting operation.

The unknown business could be facing a fine of up to $111,000 for using the software and was one of 35 businesses raided across Australia on Friday.

John Ford, Assistant Commissioner, the Australian Taxation Office. Source - LinkedIn

The software, dubbed an “electronic sales suppression tool” by the Australian Taxation Office (ATO) is either built into hardware attached to sales terminals, provided as a service over the internet or supplied on a USB stick known as a “zapper”.

It is most often seen in the hospitality industry and can be used to reduce the value of individual sales or delete them altogether.

Raids on properties in Victoria, New South Wales, Queensland, and Western Australia were also carried out, co-ordinated with similar action in the UK and USA as part of Operation Flutter.

“So what might happen is that the customer orders a $60 steak and a $100 bottle of wine and the ESS tool then puts it through the point-of-sale system as a $10 bowl of chips and a $4 bottle of soft drink,” ATO deputy commissioner John Ford said in New York overnight.

“These dodgy sales suppression tools allow retailers to keep a separate set of books and launder the money in one transaction.”

Using ESS software is a crime in Australia, attracting a fine of up to $111,000.