Why Did the NSW & Victoria Government in Australia Pass Legislation Banning ‘Cash for Scrap’?
Scrap dealers in the Australian states ofNew South Wales (NSW) and Victoria will no longer be able to pay cash for the scrap metals they purchase, all thanks to the cash ban passed. Last year, both the state governments announced that they were banning cash payments for scrap metals, a move made to curtail the rising epidemic of car thefts. But this move also faced some opposition from scrap car wreckers, who claimed that such a legislation would adversely affect their business.
What were the reasons given for the cash ban?
The cash ban did not come as a surprise to many, as the government had been tracking the scrap metal industry quite closely for a while before the ban was put into effect. The main reasons cited for the ban were:
- To fight against the increasing number of car thefts every year. A cash ban would make it difficult for car thieves and illegal scrap metal merchants to do business without leaving a trail.
- Having proper documentation of each transaction will also help fight tax evasion and loss of revenue for the governments.
- A cash ban would help regulate the previously unregulated scrap metal industry.
So, if cash was no longer an acceptable payment method, what other options were there? Payments are to be made through EFTPOS (Electronic Funds Transfer At Point Of Sale) or through non-transferable cheques. These payment methods will ensure that each transaction is recorded, making it impossible for scrap metal merchants to evade tax or trade in stolen vehicles.
What Documents Would You Require to Sell A Scrap Car?
Following the cash ban, in order to sell your scrap car, you must provide the following documents:
- A valid photo ID
- Vehicle registration papers
- Proof of ownership
- The VIN (so the scrap car buyer can carry out a check to verify that the car does belong to you and is not a stolen vehicle)
As part of regulating the scrap metal industry, it is now mandated that only licensed and certified scrap metal merchants can be in the business of buying scrap metals.
Failure to adhere to the rules could see scrap metal merchants being fined as high as $30,000 AUD. In some cases, they might even lose their license.
It was a bumpy ride for a while when the ban was introduced. But now, almost a year later, everyone’s got the hang of it and its business as usual. Looks like the cash ban has indeed helped regulate the scrap metal industry by ironing out the kinks.