New transparency requirements could see tax-dodging companies being listed on a ‘name and shame’ register, a Senate committee has proposed.
The Australian Tax Office would also be forced to disclose all tax avoidance settlements which exceed a proposed $100 million threshold, Fairfax has reported.
In addition, companies based in Australia would be required to make annual disclosures of the tax paid, their Australian revenues and tax deductions and other government write-offs taken.
The inquiry was chaired by Labor Senator Sam Dastyari who raised concerns about “a major flaw in our tax system that is enabling some of the biggest companies in the world to evade billions in tax that should be paid in Australia”.
“It’s time we name and shame our worst tax dodgers,” he said.
The inquiry into corporate tax avoidance began in September last year after a report by the Tax Justice Network revealed that almost a third of Australian companies listed on the ASX 200 paid 10% less in corporate tax compared to the statutory 30% corporate tax rate.
But the crackdown on corporate profit shifting and tax minimisation was spurred on after it was found that around 30 large multinational companies were suspected of “diverting profits using artificial structures to avoid a taxable presence in Australia” earlier this year.
Among the list were tech giants, Google, Microsoft and Apple with Apple paying just $80 million in tax in Australian on sales of $6 billion.
Around a dozen multinational tech companies were audited by the ATO and subsequently faced a Senate Inquiry into multinational tax avoidance.
This year’s federal Budget tabled a draft bill for a new doubled penalty regime for profit shifting schemes meaning that tax avoiders would not only need to pay the tax they owed, but would also face penalties of up to 100% of the tax they owe and interest.
“We simply want people or companies who are avoiding their tax to pay their fair share,” treasurer Joe Hockey said.
“Everyday Australians rightly believe that if a dollar of profit is earned here, then you should pay tax here. Unfortunately this is not always the case for some multinationals. Many have the capacity to aggressively minimise their tax.”
Business Insider Emails & Alerts
Site highlights each day to your inbox.