LABOR CALLS ON GOVERNMENT TO ACT ON TAX AVOIDANCE
Leaders around the globe have stepped up efforts to crack down on international tax avoidance by large companies and high net worth individuals in the wake of the Panama Papers leak.
Meanwhile, the Australian Government continues its lackadaisical approach to tax avoidance.
Australians are right to ask why Mr Turnbull and his Government are refusing to take meaningful action on tax avoidance.
“We shouldn’t make it legal to engage in transactions just to avoid taxes… [there is a] basic principle of making sure everyone pays their fair share”.
- Barack Obama, US President
“The rules appeared to be skewed towards some and do not apply to all”
- Christine Lagarde, IMF
“The recent extensive leaks from Panama show the critical importance of the fight against tax evasion, aggressive tax planning and money laundering"
- Finance Ministers of Britain, France, Germany, Italy and Spain”
"When taxes are evaded, when state assets are taken and put into these havens, all of these things can have a tremendous negative effect on our mission to end poverty and boost prosperity"
- Jim Yong Kim, World Bank President
- Australian Government
World Bank President Jim Yong Kim said last week “Transparency is not going to move backward. The world is only going to become more and more transparent as we move forward”.
Jim Yong Kim’s comments should raise the most alarm for Australians, who are familiar with the Government’s deal with the Greens to wind back tax reporting transparency for private firms; a deal that shielded 600 large firms from public scrutiny of their tax affairs.
It isn’t too late for the Government to change track and join Labor – and the rest of the world - on fighting multinational tax avoidance.
In 2013, Labor in office introduced the biggest ever package cracking down on multinational tax avoidance. The Coalition voted against it.
We introduced changes that provided more tax transparency and we saw the first data released last December. The Coalition voted against those too.
In Opposition, Labor has put together a $7 billion multinational tax plan carefully costed by the Parliamentary Budget Office and informed by the OECD. The Coalition are refusing to implement it.
Under Treasurer Joe Hockey, the Government dragged their feet in signing Australia up to the Common Reporting Standard and refused to join the Early Adopter Group that will begin exchanging information next year. Labor forced amendments to bring forward the reporting date, rather than letting big companies off the hook in having their accounts reported until the end of 2019 under Scott Morrison’s proposed timeline.
Labor’s Private Members Bill introduced to Parliament in February raises penalties for companies that fail to comply with Australia’s country-by-country reporting laws by fifty times. Right now the Government is keeping penalties that are about $5000. If you streak across the Sydney Cricket Ground you pay a higher fine.
While many other nations are leading on closing multinational tax loopholes, the Liberals seem content with an Australian tax code that contains more holes than a block of Swiss cheese.
SUNDAY, 17 APRIL 2016