LEIGH PLAN WOULD HELP INTERNATIONAL TAX AVOIDANCE

Labor’s policy for public disclosure of international tax reports, which are exchanged by foreign tax authorities in confidence with the ATO, would result in those other countries ending their co-operation with Australia in relation to multinational profit shifting.

“Labor is threatening effective and collaborative enforcement of tax laws applying to multinationals, operating here and in other countries”, the Minister for Revenue and Financial Services Kelly O’Dwyer said today.

At the recent Senate Estimates, the Commissioner of Taxation emphasised that these reports are of enormous benefit to the ATO. When asked what public release of country by country reports would mean the Commissioner said, “We wouldn’t have any reports to release as no one would give us any.”

“Labor’s Andrew Leigh has been caught out again on issues he does not understand,” Minister O’Dwyer said. “Like earlier this year when Dr Leigh wrote an opinion piece claiming that five faceless investors owned Australia’s largest listed companies.”

The Turnbull Government has taken strong action and introduced tough new laws, while Labor in Government did virtually nothing to combat tax avoiders and in opposition voted against the Multinational Anti-Avoidance Law. This is the same MAAL which is causing 32 multinationals to restructure their affairs, bringing in hundreds of millions of dollars of additional revenue and will lead to over $7 billion of sales being booked  in Australia for the first time.

The Turnbull Government has an exceptionally strong record in combatting multinational tax avoidance, including:

Implementing new laws to close loopholes and ensure that profits earned here are taxed here through the MAAL and the Diverted Profits Tax (DPT);

Legislating the common reporting standard and country by country reporting, giving the ATO access to information on money held by Australians in offshore accounts and the activities and tax  paid by multinationals in other countries;

Introducing stronger penalties to combat tax avoidance and profit shifting and strengthened transfer pricing rules to give effect to the latest OECD guidelines; and

Adopting the OECD’s Base Erosion and Profit Shifting anti-hybrids measure to prevent multinationals exploiting differences in the tax laws of two or more jurisdictions to defer or avoid paying tax.