AU News reports Government Floats $100 Note Removal.
Say goodbye to the $100 note.
Australia looks set to follow in the footsteps of Venezuela and India by abolishing the country’s highest-denomination banknote in a bid to crack down on the “black economy”.
Speaking to ABC radio on Wednesday, Revenue and Financial Services Minister Kelly O’Dwyer flagged a review of the $100 note and cash payments over certain limits as the government looks to recoup billions in unpaid tax.
“The whole point of this crackdown on the black economy is to make sure we close down any potential loopholes,” she said. Despite the broad use of electronic forms of payment, Ms O’Dwyer warned there are three times as many $100 notes in circulation than $5 notes.
“It does beg the question, ‘Why?’” she said.
There are currently 300 million $100 notes in circulation, and 92 per cent of all currency by value is in $50 and $100 notes.
A report by UBS recommended Australia scrap the $100 note. According to UBS, benefits may include “reduced crime (difficult to monetise), increased tax revenue (fewer cash transactions) and reduced welfare fraud (claiming welfare while earning or hoarding cash)”.
“From the banks’ perspective there would likely be a spike in deposits — if all the $100 notes were deposited into banks (ignoring hoarded $50 notes), household deposits would rise around four per cent,” the report said.
Financial Services Minister Kelly O’Dwyer notes there are currently 300 million $100 notes in circulation, and 92 per cent of all currency by value is in $50 and $100 notes.
“It does beg the question, ‘Why?’” she asked.
It would behoove O’Dwyer to think. People can have 100 pennies in their pocket (each of which is nearly worthless) or they can hold a dollar.
Similarly, people can hold a stack of ten $10 notes in their wallet or they can hold a $100 note.
Mathematically it makes perfect sense that 92 per cent of all currency by value is in $50 and $100 notes.
What the hell does $1 buy these days? Is someone going to carry a wad of fifty $1 notes to go to a movie and buy popcorn?
Rest assured this will not stop with $100 notes. There will be no cash within ten years.