Economy Is Accounted For Can Be Referred †Myassignmenthelp.Com

Question: Discuss About The Economy Is Accounted For Can Be Referred? Answer: Introducation The Black economy refers to that part of the economy that prospers at the expense of the Government of a country. The part of the economy that is accounted for can be referred to as the white economy as it falls within the ambit country rules, regulations and tax net. Exactly opposite of this segment of the economy is known as black economy. The economic activities of a country that are outside the purview of the countrys rules, regulations are known as black economy (Schneider Enste, 2013). These economic activities are conducted without following the rules and regulations of commerce of the country and are not accounted for taxation purposes. However, it is important to note that such activities need not be illegal thus, there can be legal activities too, which are part of black economy of a country. The characteristics of goods and services of a transaction would determine whether these are legal or illegal activities. For example a worker who is involved in construction work if paid under the table, the payment under the table will be part of black economy however, the construction work though legal. The fact that the payment has been made to the worker under the table to avoid payment of tax, both the person who has paid for construction work and the worker have flouted the rules and regulations to avoid payment of taxes (Guttentag, 2015). Shared Economy: In an economic system in which the assets as well services can be shared between private individuals of the country in exchange of fees or free of cost is known as a shred economy. To put it other way the individuals in a shared economy have the ability to borrow or rent assets owned by other individuals of the country. This system of shared economy has been in use since the advent of society. Over the years the ways of sharing have only changed but the objectives have more or less been the same, i.e. to enrich the lives of people of a country. In modern day and age of internet the sharing have become easier and happening at larger level than ever before. Under used assets are used by individuals and groups to make money in a shared economy thus, there are numerous possibilities in a shared economy which is not available in closed economy (Schneider, 2015). Answer to Question B A closer look at the Australian economy will help us to understand the importance of business organizations operating in accordance with the concept of shared economy. Though in general most of the top business houses in the country follows the more traditional method of doing business however, the contribution to the overall development of the Australian Economy made by business organizations and firms operating under shared economy concept cannot be denied. Airbnb, Snapgoods, Dog Vacay, Relay Rides, Task Rabbit, Getaround Liquid are few of the well-known names in the shared economy in the country that have showed other organizations a way different from traditional concept of doing business. Thus, these organizations and businesses can be termed as the pioneers of shared economy concept in the country (Dunleavy, 2015). TaskRabbit works as a bridge between service seekers and service providers through its online portal and mobile market place. With its online and mobile market place it attracts the freelance labors and workers to engage their efforts in a concerted manners towards satisfying the demands of services and different types of works in the marketing place. The main objective with which the organization had come into force was to match the freelance labor with the demands in the local market. As the concept prevails in shared economy, it is about sharing the resources and assets owned by the others which remain unused to benefit others. TaskRabbit allows consumers and clients to find immediate solutions with their regular work and activities. These include regular cleaning, moving things from one place to another place, delivery of goods or other materials and assets, handyman work etc. TaskRabbit plays a huge part by its online and mobile market place for both those who needs such service s to be done and to those who will provide these services in exchange of a particular fees (Dunleavy, 2015). The company was founded in the year 2008 by Leh Busque and has astonishingly received $37.7 Million till now to fund its activities. The company at present has as many as tens of thousands of vetted. The reason for such huge funding is the popularity of the concept of the company and its importance on the daily lives of the people of the country. It is beyond any doubt that people need support on daily basis to sought out various works and activities in their homes and offices which often seem simple but far from that. TaskRabbit allows consumers to use the services of the service providers even for simplest of works with a minimum expenditure. TaskRabbit provides background checks on the service providers to ensure that only individuals with clean and clear images are allowed to provide services to the people in general. The company has taskers available to provide necessary support to the consumers in background checking in different category of services to ensure that the consumer s are not under any possible threats from the service providers (Pearson, 2017). At the time of starting the operations in 2008 TaskRabbit accumulated $1.8 Million in seed funding from firms in venture capital business. In the year 2011 the company closed a $5 Million series financing and in July 2011, the company launched an app to allow the service seekers to provide their desired services and tasks by posting from their iPhones. An additional funding of $17.8 Million was received under series B round of funding. The progress of the company can be assessed from the fact that by this time the company had 35 employees and generated business of $4 Million in each month. In the year 2013 a new tool was introduce by the company named TaskRabbit Business to allow business organizations top hire temporary work force according to their needs from the users of TaskRabbit. The concept of shared economy and its advantages cannot be better described in any other business as the business of TaskRabbit Company is a perfect match with the concept of shared economy (Pearson, 2 017). At present the company is one of the most sought after business organizations in Australia and a prime contributory in shared economy in the country. It would not be wrong to say that TaskRabbit is one of the pioneers in shared business economy in the company and has shown many organizations the way to do business under the concept of shared economy. The business aspect of shared economy has never been given second importance to anything else as often is given a reason by big firms and organization as a reason for not following the path of shared economy rather if the concept of shared economy is properly followed it could be a game changer in developing the economy of a country. A closer look at the operating results and financial position of the company will help us to assess the overall impact of shared economy on the business. The performance of the business over the years have shown an increasing trend as it started from zero employee in the year 2008 and then appointed i ts first full time employee in the year 2009 and now have more than 100 dedicated employees working for the organization. The operating results have also shown positive attributes as it has a business worth Millions of dollars in every year now (Kelsey, 2015). Laundry Group is an organization which is providing opportunity for regular and ongoing freelance work in the country to help the consumers and customers in their daily activities. The business follows the path of more traditional economy and do not believe in the concept of shared economy. Situated in Brisbane, Australia the organization has been in the business of providing support for day to day works and activities for quite a few years now. The organization similar to TaskRabbit uses the on-line and mobile marketing features to reach to the maximum number of consumers and customers possible. The organization explains its business as connecting brands to customers. Compare to the shared economy the traditional economy is more business specific in its approach as it does not believe in the concept of sharing and allowing others to make use of the resources owned by others. The differences between the way two businesses, i.e. TaskRabbit and Laundry Group, operate are vast and major . One is a firm believer in sharing economy and allows consumers and customers to use the resources owned by it to benefit them as well as the company itself. However, on the other hand organization like Laundry Group is a traditional business organization and only motivated to maximize its profit and shareholders wealth by taking all possible measures. Pay and use is the motto of the organization in traditional economy and it is not different for Laundry Group. The organization started it business a decade ago has now a huge market presence in Australia. The organization uses the unlimited reach capability of online and mobile market place to reach to millions of customers and consumers across the country(Pearson, 2017). A recent report on the workings of the companys internal structure and the way it serves the customers and consumers makes it amply clear that the company uses the characteristics of traditional economy very effectively to make profit from business activities. The organization has conducted its business very efficiently over the years as is clear from the increasing trends in its profits. The organization earned a mere profit of $21000.00 in the year of its formation which increased by 3 times in the very next year as the organization made a profit in excess of $83000.00. The fact that the organization was able to make profits in its very first year in business is due to the traditional economy and its business model. As for organizations in shared economy the chances of earning profits from the very beginning is very slim as the organizations in shred economy are more careful about allowing others to get equal benefit from the use of resources not owned by them as they believe in th e concept of sharing resources for the financial benefits of each other. The traditional business organizations on the other hand are only motivated to maximize the profits from business and maximizing the wealth of the shareholders. The taxation outcome of organizations working under two different economies are significantly different due to the way of doing business. For companies working in shared economy the tax consequences are relatively less compare to the organizations working in traditional economy. This is also due to the fact that traditional business organizations have a specific goals of maximization of profit which is not the case for organizations in shared economy (Kelsey, 2015). Due to these differences the final tax inability of an organization in shared economy is generally much less as compare to an organization working in a traditional economy. However, it is important to note here that no organization should be allowed to use the shared economy concept as a veil to avoid payment taxes.; Let us first go through the recommendations made by the Treasury in Black Economy Taskforce Interim Report before analyzing which of these recommendations would be successful in reducing the contribution of the sharing economy to the problem of black economy (Dunleavy, 2014). Here are the recommendations of the Treasury of Australia to reduce the contribution of shared economy to black economy: Only firms with good tax records should be allowed access to the procurement opportunities of Australian Government. Incentives should be given to the small firms and business organizations which have made investments in non-cash business models to motivate others to follow the same path (Winer et al., 2013). Taxation payment reporting system should be expanded. Payment of cash wages and payments to the contractors in cash should be restricted by providing tax deductibility imposition for such payments. All technologies used to suppress sales should be banned immediately Business registration integrity shall be enhanced by taking modernization steps in this regard. Necessary training shall be provided to small firms and business organizations on taxation related matters. Increase amount of funding shall be made on ATO activities. Reduction in regulatory burdens for small business and firms to ensure that these organizations are not over burden with the regulatory requirements, Imposing limitations on cash payment across the economy to achieve better tax net expansion in the whole economy A sharing economy-reporting regime shall be introduced for better taxation system. GST threshold shall be lowered. Amnesties should be used less. Unnecessary arrangements shall be withheld. Data privacy shall be increased and used effectively by the Government agencies. Phoenix taskforce shall be introduced. Beneficial ownership reforms. The above recommendations need to be implemented properly in order to achieve the objective of Black Economy Taskforce. Thus, the recommendations made by the Treasury if implemented properly will be help in achieving the desired objectives of reduction of contribution of shared economy in overall black economy (Pearson, 2017). 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