Australia must put tough talk into action and follow the United Kingdom’s move to force multinational corporations dodging billions of dollars in taxes to publish country-by-country financial reports, international aid agency Oxfam said today.
Oxfam Chief Executive Dr Helen Szoke said the Conservative Government in the UK had last night accepted an amendment to legislation which will require multinational corporations with headquarters in the UK to publicly report on their taxes and profits in each country in which they operate.
Currently this information is only reported to the Australian Taxation Office, which makes it very hard for the public to hold large corporations to account.
“It’s time the Australian Government followed the example of the UK, European Union, United States and Canada on forcing multinational corporations to be transparent,” Dr Szoke said.
“There has been a lot of tough talk, but now we need tough action on tax transparency in Australia.
“The Australian Government must modify legislation so large multinationals based in Australia are required to publicly declare income, profits and tax paid in each country where they operate.
“It is crucial to have publicly accountable corporations in the 21st century.”
Country-by-country reports show basic information about a multinational’s operations, including taxes paid, number of employees, revenue generated, profits, and taxes paid in each country where the company or its subsidiaries operate.
These reports can give light to abuse of tax laws, and aggressive tax avoidance by multinationals.
“Oxfam’s recent research found tax-dodging practices by multinationals deprived the Australia’s public coffers of as much as $6 billion in 2014 alone,” Dr Szoke said.
“We know that one in three large companies reported on by the ATO in 2014 paid no tax in that financial year.
“Country-by-country reporting is crucial in the fight against tax dodging. Our research also found Australian-based multinationals were depriving developing countries of nearly $3 billion.
“This is billions in tax revenue that could be spent on public services including hospitals, schools and roads in Australia and in some of the poorest countries in the world.”
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