Australian NGOs call for greater transparency for multinationals
Transparency is key for a fair tax system
The Australian Government’s plan to improve the transparency of the business tax system has the potential to ensure developing countries are not cheated out of their fair share of tax revenue, the Publish What You Pay Australia and Tax Justice Network Australia coalitions said today.
Publish What You Pay Australia and Tax Justice Network Australia would like any new rules to extend to the overseas operations of Australian businesses.
Publish What You Pay Australia spokeswoman Serena Lillywhite – a member of the Government’s specialist reference group on tax - said a complex web of business units and subsidiaries often was used to hide or shift profits for the purpose of tax minimisation and evasion.
“Trade-related tax dodging means developing countries are missing out on more than US $160 billion of government revenue each year, which represents more than they receive in international aid,” Ms Lillywhite said.
Tax Justice Network Australia spokesperson Mark Zirnsak, also a member of the reference group, said greater transparency, better information flows, disclosure of tax payments in all countries of operation and disclosure of company ownership would strengthen the Australian business tax system and ensure that everyone was playing by the rules.
“This will help ensure that companies do not get an unfair advantage in the marketplace by tax dodging, rather than by being more innovative or having a better product to sell,” Mr Zirnsak said.
“It also will reduce the risks for investors and suppliers, by allowing them to better assess the state of companies with complex structures so they have a better understanding of who they are doing business with.”
Ms Lillywhite said the Government’s intention to explore ways to share information between the Australian Taxation Office and key corporate regulators such as the Foreign Investment Review Board provided an opportunity to introduce disclosure requirements, similar to those recently introduced in the US for all oil, gas and mining companies listed on the US securities Exchange.
She said many resource-rich, poor countries where Australian mining companies operate were missing out on much needed tax income due to clever accounting and incentives that left many of the poorest without essential services such as hospitals and schools.
For further media information please contact: Laurelle Keough at Oxfam Australia on 0425 701 801