Name and shame the ‘worst offenders’ dodging tax: Greens
Companies would be forced to reveal any arrangements that are used to avoid tax, and those not paying their fair share of tax would be named and shamed on a “worst offenders” list, under a plan by the Greens.
The party has released a discussion paper detailing policies to fight multinationals exploiting loopholes in our tax laws. It said billions of dollars was being lost via “aggressive tax planning” by companies that could instead be spent on schools, hospitals and creating jobs.
The party wants multinationals to “open up their books” and for the ATO to publicly name and shame the “worst offenders” of tax avoidance.
Multinationals would also be required to give “high levels of detail about their activities and tax arrangements” and would no longer be able to use subsidiaries to claim exemptions from the parts of the Corporations Act that require financial reporting.
There would be a new public register of the ultimate beneficial owners of companies – to stop the use of shell companies and special-purpose entities that enable tax dodging and illicit flows of money.
The Greens also want more resources given to the Australian Tax Office to fight profit shifting, including reversing the 4700 ATO job cuts dished out by the Abbott government. Already 3000 of these job cuts have been made, with the remaining 1700 to take place by 2018.
It also proposes the ATO’s settlement register – which lists companies the agency settles with each year and the reasons for it – be made public. The Tax Office publishes in its annual report statistics on settlements, but does not give details on who it settles with and the reasons for the settlement. According to its annual report, in 2013-14 it settled on $1.2 billion worth of cases with 34 large companies.
The Greens also want legal protections for private-sector whistleblowers. It suggests a United States-style false claims act, so that whistleblowers can get a cut of the collected revenue if the ATO succeeds in prosecutions of tax fraud on the basis of the disclosure.
It also wants stronger powers for the Australian Securities and Investments Commission. It suggests boosting disclosure of related-party information in financial reports and strengthening information sharing between ASIC and the ATO.
Greens leader Christine Milne, who initiated the Senate inquiry into tax avoidance, said Treasurer Joe Hockey’s plan to set up a working group with the British government and take lessons from Britain’s “Google tax” plan, is just talk.
“It’s simply not good enough to just talk about having an exchange of officials with the UK to talk more about the problem at some point after their election,” Senator Milne said. “If we are serious about corporate tax avoidance there are things that can be done right here, right now, in Australia.”
“We cannot tax what we cannot see. Both the public and the parliament have a right to know which companies are dodging their taxes.”
The business community has been urging the federal government to avoid taking unilateral action, and instead work within the global framework being overseen by the OECD. But the Greens have called for immediate action.
Labor has also released a $2 billion plan to fight tax avoidance. The Abbott government wants to remove about 700 private companies from Labor’s tax disclosure laws that would publicly reveal the tax paid by the nation’s largest companies.
