Joe Hockey is pushing for the Federal Government to close loopholes which are being exploited by multinational companies to shift profits offshore, in orde to minimise these companies’ tax bills. Mr Hockey has suggested that the first target will be multinationals which load up debt in parts of their business located in high tax jurisdictions such as Australia. Proposed changes are expected to be legislated later this month, as it is expected that the opposition and the majority of all crossbench senators will give these changes their support.
Since 2002, Apple has paid just $193 million to the ATO, while an estimated $9 billion was shifted off-shore to minimise taxation. Google brought in more than $2 billion in revenue from Australian ad sales last year, but this money goes directly through its Singapore branch and no tax is collected or paid. Australia’s largest coalmining company, Glencore has paid almost no tax over the past three years despite income of more than $15 billion.
Mr Hockey is confident that the move to legislate against multinational companies avoiding paying tax in Australia will see $2 billion returned to the government over the next four years.
Read more from The Age.
Read more about Google.
Read more about Apple.
Whether it is a company pillaging our land for resources or a company employing hundreds of our best and brightest researchers and exploiting our generous research grants, every company, whether local or multinational, should be made to pay their way.
For far too long, our Federal Government has sat back and watched companies such as Apple, Google and Glencore (there are many more which could be added to this list) funnel money earned in Australia out of the country without paying a fair amount of tax. Each of these companies does employ a significant number of taxpaying Australians, but the tax on profits made in our region which isn’t being paid is leaving a serious hole in our budget, a hole which has to be filled by average Australian taxpayers.
It’s quite simple. If you want to sell your product or operate in Australia, then pay your way. The Federal Government should be willing to go the extra step in and prevent a company which evades paying taxes from operating in our country altogether.
What do you think? Is this a step in the right direction for the Federal Government? Should the Federal Government threaten to ban companies, which continue to evade tax, from operating in our country? Or do we need their business?