The Albanese Government is making sure that the world’s largest multinationals pay their fair share of tax, continuing our ongoing commitment to multinational tax reform, by signing a Statement of Support for the OECD’s ‘Subject to Tax Rule’.
The ‘Subject to Tax Rule’ allows developing countries to apply ‘top-up tax’ when certain types of income have not been taxed at a minimum rate.
The signing of the OECD Statement of Support follows the introduction of legislation in the Australian Parliament to ensure multinational companies pay their fair share, building on implemented measures such as:
- tightening Australia's thin capitalisation rules to reduce multinational companies’ ability to create artificial debt and reduce their tax bill.
- creating a new disclosure law requiring Australian public companies to disclose information about their subsidiaries (including information on location of incorporation and tax residency).
- requiring tenderers for Australian Government contracts valued above $200,000 to disclose their country of tax residency.
- boosting funding for the Tax Avoidance Taskforce to bolster its work cracking down on tax dodging by multinational enterprises.
These significant steps place Australia among the lead jurisdictions working to improve the international tax system under the OECD/G20 Two‑Pillar Solution that was agreed in 2021.
A tax system where big multinationals pay their fair share of tax is better for our economy and all Australians. Along with the global minimum tax legislation recently introduced to Parliament, our support for the Subject to Tax Rule means that Australia has supported the OECD’s Pillar Two reforms in their entirety.
No government in Australian history has done more on multinational tax fairness than the Albanese government.