The ATO has squeezed an extra $5.6 billion in tax from multinationals

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  • ATO’s Tax Avoidance Taskforce has collected $5.6 billion in extra tax in just two years.
  • The focus is on the top 1000 multinational and public companies as well as the top 320 private groups and the high wealth individuals who control them.
  • Diverted Profits Tax reviews have resulted in 44 companies bringing their Australian sourced sales back onshore.

The Australian Tax Office’s (ATO) crack down on multinationals, including the giant tech companies, and private companies has brought in $5.6 billion in extra tax in just two years.

The Tax Avoidance Taskforce, with $679.9 million in extra funding from the federal government, has allowed the ATO to focus on the top 1000 multinational and public companies, the top 320 private groups and the high wealth individuals who control them.

“This means that the ATO is running a fine-toothed comb over two-thirds of all corporate tax paid in any given year,” says Deputy Commissioner Mark Konza.

“With the help of the Tax Avoidance Taskforce, we have collected just over $5.6 billion in the first two years, at the same time we have raised over $10 billion in tax liabilities.”

The current focus is on wealthy individuals and associated groups, including trusts, reviewing or auditing 700 taxpayers.

The ATO also has 71 audits covering 67 multinational corporations under way, along with Multinational Anti-Avoidance Law and Diverted Profits Tax reviews.

As a direct result, 44 companies have brought or are bringing their Australian sourced sales back onshore.

“As a result of the Multinational Anti-Avoidance Law, more than $7 billion in sales annually is expected to be returned to the Australian tax base,” says Konza.

“We have also seen more than half a billion dollars in extra GST paid in 2017-18 as a result of some global entities restructuring in response to the MAAL. We expect this will continue to grow.”

The ATO has also been receiving and sharing reports with other tax jurisdictions.

Country-by-country reporting is providing a broader picture of compliance behaviour, providing an in-depth view of multinationals’ global structure, operational and economic activity. This information is extremely important, as it allows the ATO to build a complete picture of the taxpayer.

“We’re very confident that with these measures now fully in place, and with continued resourcing of the Tax Avoidance Taskforce commitments, we can ensure significant private groups and large companies, including multinationals, are fulfilling their tax obligations in Australia,” says Konza.

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