Australians set out plans for MNC tax transparency

by: Sara White

The Australians are consulting on plans to introduce tax transparency reporting for large business, including multinationals operating out of the country.

The Australian treasury has floated plans to require large corporate entities with turnover of A$100m (£68m) or above to disclose their full corporate tax details.

The move comes as the G20 countries and OECD both look at ways to address profit shifting by multinational companies. G20 finance ministers, led by the UK, France and Germany, pledged to crack down on tax avoidance by multinational companies at their last meeting in Moscow on 15 February.

The Australian consultation, set to close later this month, follows an earlier announcement that it intends to change the tax laws to improve the transparency of Australia's business tax system. Potentially it would mean that major multinationals like Apple and Google would be forced to report their Australian tax position.

Assistant treasurer David Bradbury said: ‘Increasing the transparency of tax payable will enable the public to better understand the corporate tax system and engage in policy debates, as well as discourage aggressive tax minimisation practices by large corporate entities.’

The consultation paper sets out the details of three specific proposals:

  • transparency of tax payable by large and multinational businesses with total income of A$100m (£68m) or more per year;
  • publishing aggregate collections for each commonwealth tax; and
  • enhanced information sharing between government agencies.

The information, which is already provided to the Australian Taxation Office, would be made publicly available by the Commissioner of Taxation.

The push to improve transparency of tax payable by large multinational companies is part of broader efforts to crack down on profit shifting by the Australian authorities.

‘The government is continuing to progress its reforms to our tax laws to prevent profit shifting, close loopholes and protect the integrity of our tax base,’ said Bradbury.