Coalition and Greens strike deal on multinational tax avoidance

The Greens have been labelled “tax transparency traitors” by Labor for agreeing to pass the Government’s multinational tax avoidance laws, but the deal is also causing friction within Coalition ranks.

Under the deal, multinational companies with a global turnover of $1 billion or more will have to prepare “general purpose” financial statements that disclose greater tax details.

But the point of controversy relates to the exemption for certain private companies from disclosing their tax affairs.

The Coalition passed laws in October to reinstate the exemption that shields around 1,500 Australian companies.

The Greens recently sided with Labor in the Senate to demand those with a turnover above $100 million be forced to disclose their tax arrangements.

But under the Greens-Coalition deal, the threshold will be higher at $200 million.

Shadow treasurer Chris Bowen called the Greens “gutless” for not sticking to its position and calling the Government’s bluff.

“The Australian Greens under Richard Di Natale’s leadership are the tax transparency traitors of Australian politics, traitors to those Australians who want to see everybody paying their fair (share) of tax,” Mr Bowen said.

Greens leader Richard Di Natale has defended doing the deal for a $200 million threshold.

“The choice is a simple one, we either get nothing or we get significant strides forward when it comes to combatting multinational tax avoidance, simple equation,” Senator Di Natale said.

Greens finance spokesman Peter Whish-Wilson declared his party was “on the side of angels” and the Labor Party “irrelevant”.

In fiery scenes in the Senate, Labor’s Kim Carr slammed the Greens as the “lickspittles” of the Government.

It led to the rare sight of Liberal senator Bill Heffernan leaping to the Greens’ defence and suggesting a score could be settled outside the chamber.

“I won’t sit down, you want to come outside the chamber (order) you boofhead,” Senator Heffernan called out.

The ABC understands there is concern within Liberal ranks over the decision to backdown on the exemption for private companies without going back to the Coalition partyroom for approval.

One Liberal told the ABC it was a “captain’s call”.

Labor estimates the number of companies that will now be covered by the reporting rules has fallen from 900 to around 300 now that the Greens have agreed to raise the threshold from $100 million to $200 million.

Shadow assistant treasurer Andrew Leigh said it was “a dirty deal done very expensive”.

The Greens deal secures the passage of the Government’s bill that will introduce country-by-country reporting by significant multinationals and increase the penalties imposed on those that enter into tax avoidance or profit shifting schemes.