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Black Money

April 11, 2019


     When I started out, the restaurant industry drank from a stream of black money. Hospitality was, as the Japanese call it, a water trade where money flowed in and out. This state of affairs was natural - quite casual in fact, and benefited customers, workers, suppliers and owners alike. It wasn't much chop for tax office coffers, but this sub rosa system underwrote a hell of a lot of good times.

     In that pre-EFTPOS era, cash was king. At day's end the till contained a few cheques (would you trust one today?) and some carbon copy imprints from those high rollers who owned credit cards - but cash would be the absolute majority of the takings. Crucially, all that moolah came straight from the customer's hand, digitally unrecorded, innocent and free.

      With this daily deluge, large denomination notes often dripped through the cracks. When the owner, or a spouse or family member, is the cashier, then it ain't real hard to render down a cash stuffed till into two streams of income – one legit, the other pure cheeky profit. Good operators could skim 20% or more of the days takings, and canny owners with an eye for selling their business down the track would have two sets of books - and maybe an artful accountant in on the joke as well.


     Totally AWOL from the expenses column, cash flowed out too - as discounted wages and produce purchases. Whole-sale suppliers would offer price mark-downs on cash payments, the understanding being that any invoice was just a list of what had been ordered - not a record of payment due. Seasonal suppliers at kitchen back doors carried cases of good stuff and required no signatures on receipts - just dollar bills thanks.

     In the kitchen, chefs, cooks - even dish pigs - worked a forty five hour week on the books, paid their twenty something percent tax and were generally model citizens. Then they did another twenty or thirty hours for cash in hand - at a slightly lower rate of pay that rewarded both them and the owner. It was a two way street that everyone was most happy to meet on.

     A whole stripe of customer didn't miss out at a place at the table either, as tax laws back then provided a special incentive for those in business to stuff their faces and get royally pissed. While taking ' meetings' over a three course lunch and half a dozen bottles of wine they could claim it all as a business expense. And they did. Often daily.


     Talk about trickle down economics! Owners, buoyant on a sea of filthy lucre would spread their largesse around. Good customers got free desserts, bonus entrees, comped coffees and bottles of wine gratis. Really fun regulars got invited to settle in after close as the top shelf liquor flowed. Staff would routinely get a knock off drink, or three, if the owner liked to party with them, and they'd end up spending some of their bonus cash at the bar. The business types would kick on too, cheerfully arguing with equally sloshed owners about who was paying for the next round. I may have seen this scenario a few times over the rim of my glass.

      With all that extra money, and blithe contempt for what their livers and hearts may have thought, the roaring eighties was a time of delirious abundance for many people. They would eat two dozen oysters as an entree and share six desserts on a table of four. I could easily eat a 600 gram steak and drink ten beers in a sitting. Easily. Hell I'm putting on weight just thinking about it. But the tax office, ever keen to keep us lean, has always reserved a special kind of suspicion for deductions that involve anything pleasurable. They wheeled out the Fringe Benefits Tax and blew away food and drinks as a business expense. Now only the rich bastards could afford to have six hour lunches.


     Actually, come to think of it, most of those retro rorts never really stopped. Some got high tech. Outlaw owners today can hit the till with a zapper – sales suppression software. Kept on a USB stick and used remotely, these programs are smart. They'll delete sales records, re-number and re-calculate records of each receipt. Then they'll produce perfectly conforming financial reports for the taxation office to happily sign off on. Zappers can also escape the confines of the cash register and slip into stock inventory and employee time records, and make the facts fit the fiction. A $10,000 day with a full complement of staff and major depletions of the cold rooms and bar fridges can be shrunk to a pretty decent $7,000 day.


     And though far from my own experience, it appears that dirty dosh, like love and rock'n'roll, is still a big part of being human. The ATO recently estimated that 45% of businesses in the restaurant, cafe, takeaway and catering industry are cash only. Wow. In some postcodes nearly all businesses, not just those producing cooked food, deal in cash. You have to join the flock if you want to fly in that bit of sky. Hospitality creates millions of B2C (business to consumer) transactions each day, all involving pretty small amounts of money, so it will always be hard for the government to police their skim. It's a sure bet that black money is going to be around for a long time to come - unless cash itself is totally outlawed.


     The truth is, the world doesn't fall apart when a bit of illicit liquidity lubricates the lives of some damn hard workers - the kitchen crew sweating over stoves, the owners freaking out over shrinking profit margins and the suppliers facing continuously rising produce and energy costs. Anyone of them would love to have a tax-free two or three hundred dollars a week - you know like the politicians get every day. A government worried about the 'deficit' this naughty money creates could just make a couple of multinational corporations pay their taxes. There'd be a real easing of mortgage repayments, school fees and medical expenses then. And knock-off drinks fro everybody!




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