Andrew Leigh

With reports today that the Treasurer is preparing to legislate "new" measures so global companies pay their share of tax, I was keen to remind the public of the Abbott Government's backward steps in this area. Joe Hockey's measures aren’t new and they don't embrace what Labor sought to put in place.

MEDIA RELEASE

HOCKEY’S HOT AIR SOLUTION TO MULTINATIONAL PROFIT-SHIFTING

The Abbott Government’s measures on multinational profit-shifting are still considerably weaker than those announced last year by Labor.

Since coming to office, the Government’s only policy announcements on multinational profit-shifting have been to reverse sensible Labor measures.

 

In total, the government’s backsliding amounts to $1.1 billion since the election.

The largest single item in this is the government’s December 2013 back down on section 25-90, which cost the budget $600 million. There is no sign that it is revisiting this decision in this latest announcement.

While details of Mr Hockey’s new announcement are scant, it appears that he has merely re-wrapped part of Labor’s 2013 package, rather than implementing it in full.

Mr Hockey’s bluff and bluster on multinational profit-shifting is in stark contrast to his hard-line approach to the vulnerable.

After a generation of rising inequality, this is a government that cares more about cutting supports to the bottom than closing loopholes at the top.

The Abbott Government has plenty of courage when it comes to cutting the pension, but goes to jelly when faced with a serious reform issue like multinational profit-shifting.

When it comes to serious tax reform, Joe Hockey couldn't go two rounds with a revolving door. 

Multinational tax measures the Abbott Government has got rid of since coming to office:

Measure	Date   Announced	Value over   the forward estimates
Reforms to the   offshore banking unit regime	13th May 2014   (BP 2)	-180 million'
Legislative   elements of the measure to improve tax compliance through third party   reporting and data matching.	13th May 2014   (BP 2)	-113.1 million'
Not proceed   with changes that would have applied to multiple entry consolidated groups.	13th May 2014   (BP 2)	-140 million'
Abolishment of   section 25‑90	6th November   2013 (Media Release)	‑$600 million'
Offshore   Banking Unit	6th November   2013 (Media Release)	-$100 million'
		Total sum=  -$1.1331 billion

 

THURSDAY, 3 JULY 2014