Rejecting an illegal tax-free business quote. Should I tell him why?

[Edmundus1581]

I have a $700 garden task which needs to be done by a specialist. The first business I called in for a quote offered me a cash-only, tax-free price. This is illegal in Australia because all businesses (except the smallest) must charge a 10% Goods-and-Services tax (GST) and include the tax in any quoted price. So, this businessman is working illegally in two ways - charging “cash only”, to avoid paying income tax, and also charging GST-free. By charging GST-free he undercuts other, honest, business who include the 10% GST in their price.

I have made an appointment for him to do the job, but, now, thinking about it, I have decided to cancel it, because I don’t want to participate in this illegal and immoral tax avoidance.

Should I just message him with “I have decided not to go ahead with the job”, or, should I add a brief explain why, eg. “I don’t pay for GST avoiding fees”.

Thankyou.

 

[jmcrae]

I have a $700 garden task which needs to be done by a specialist. The first business I called in for a quote offered me a cash-only, tax-free price. This is illegal in Australia because all businesses (except the smallest) must charge a 10% Goods-and-Services tax (GST) and include the tax in any quoted price. So, this businessman is working illegally in two ways - charging “cash only”, to avoid paying income tax, and also charging GST-free. By charging GST-free he undercuts other, honest, business who include the 10% GST in their price.

I have made an appointment for him to do the job, but, now, thinking about it, I have decided to cancel it, because I don’t want to participate in this illegal and immoral tax avoidance.

Should I just message him with “I have decided not to go ahead with the job”, or, should I add a brief explain why, eg. “I don’t pay for GST avoiding fees”.

Thankyou.

He should probably know why - especially if you are hiring his competition, since he will find out about that, soon enough. It’s better for him to know why ahead of time, than think that his competitor is undercutting him.

 

[purplesunshine]

I would not tell him. I know of too many unscrupulous journeymen who would go back and “add” tax just to appease the owner and simply collect the additional money with no intention of paying taxes.

This is different than having a college kid paint your house for a couple reasons. 1)you expect a highly professional outcome and 2) specalized knowlege is involved so you are cheating someone else out of their job.

 

[JRKH]

I would not tell him. I know of too many unscrupulous journeymen who would go back and “add” tax just to appease the owner and simply collect the additional money with no intention of paying taxes.

The issue here isn’t the amount he quoted but the fact that this would need to be a “cash” transaction. That right there is a red flag.
If he comes back with a "tax added’ quote, but still insist on cash, then I would assume as you do. but if he came back with a tax added quote and would accept check or credit card that would be different since there would be a paper trail.

But - I definitely agree with dropping the contract (if you can) and going with a more honest company…and yes you should probably tell him why.

Peace
James

 

[Edmundus1581]

Thanks everyone for the advice.

The issue here isn’t the amount he quoted but the fact that this would need to be a “cash” transaction. That right there is a red flag.
If he comes back with a "tax added’ quote, but still insist on cash, then I would assume as you do. but if he came back with a tax added quote and would accept check or credit card that would be different since there would be a paper trail.

**But - I definitely agree with dropping the contract (if you can) and **going with a more honest company…and yes you should probably tell him why.

Peace
James

I would not usually attempt to get out of a “contract”, whether or not I was legally obliged, however in this case there is no “contract” because, of course, there is no paperwork, and even a verbal contract is not binding if the “consideration” (ie. payment) is illegal.

 

[JRKH]

Thanks everyone for the advice.

I would not usually attempt to get out of a “contract”, whether or not I was legally obliged, however in this case there is no “contract” because, of course, there is no paperwork, and even a verbal contract is not binding if the “consideration” (ie. payment) is illegal.

Very true, and in thinking about this, I’m reminded of the number of times I’ve seen programs on HGTV where someone went this route and the work was shoddy etc. and, of course, no contract, no paper trail - no way for you to go after them…
Ever watch "Holmes on Homes? It’s a Canadian show. Do you guys get that show in Australia?

Peace
James

 

[Edmundus1581]

Thanks again for the advice, everyone!

I messaged him saying that I would be paying by check or card, and asking for the price. I thought that would either make the deal honest, or that he would drop out, quietly. He didn’t respond, so I thought that was the end of it.

However, he turned up this morning, and brazenly told me that if I was paying by check then it would be the cash price, plust 10% GST.

He did the job (very well), so I paid him by check, making sure that it was made out to his business.

Not happy with whole affair, but at least the job has been done well, and I’ve ensured the GST will be paid this time.

~ Edmundus