Sex Workers and Paying Tax
Current sex work licensing laws enable around 20% of sex workers to work legally, with the remaining 80% driven underground, working outside the law. However, all sex workers are required to pay tax. Sex workers face many barriers to paying tax. These include:
- The complexity of Victoria’s sex work laws make it difficult for sex workers to understand how these laws relate to taxation.
- 80% of sex workers in Victoria are criminalised and may fear declaring their income/occupation will expose them to prosecution by police.
- Intense stigma surrounding sex work results in most sex workers concealing their occupation from friends, family and authorities, including the ATO.
- Establishing an Australian Business Number (ABN) as a sole trader enables others to locate your legal name, via the ABN Lookup website. Most sex workers are careful to prevent clients and others from discovering their legal name.
- By law, tax invoices handed to clients must include a self-employed sex worker’s ABN, allowing the sex worker’s legal name to be identified using the ABN Lookup website.
- In order to suppress a name from the ABN Lookup website, sex workers must have a valid reason, such as an intervention order or proof that they have been the victim of a crime.
- Most clients prefer to pay in cash.
- Financial discrimination remains widespread, making it difficult for sex workers to open and use business bank accounts.
- Most sex work support organisations focus on health and legal issues, with less emphasis on taxation information.
Last updated: 6 October 2019