QUESTION:
Treasurer, with the release of these tax papers is Australia doing enough to try and recoup the tax it should rightfully get?
TREASURER:
Well, that is exactly the advice of the ATO, that Australia is doing what we must be doing in relation to these latest revelations. We have been leading the charge in relation to international jurisdictions since the last set of papers. As we heard at Estimates, the ATO said that Australia's laws, particularly on multinational tax avoidance, were exactly what they need to be to enable the ATO to get the job done. The ATO have also said they have the resources. They have more than 1,000 people at the ATO who are working specifically on issues related to companies, multinationals and private companies.
QUESTION:
What is your message to big multinationals?
TREASURER:
Pay your tax. That has always been my message to big multinationals. Pay your tax based on what you earn here in Australia. The good news is that it is happening more and more often. The tax office has pointed to $4 billion of settlements, around about $1 billion of which have been specifically able to be dealt with because of our tougher multinational anti-avoidance laws. On top of that we have about $7 billion worth of sales which have come back into the GST net because of our tougher multinational anti avoidance laws. So my message to multinationals is pay your tax and increasingly that is exactly what they are doing. Our diverted profits tax came into place on 1 July this year. Not only are we doing everything that the ATO believes we should be doing but when you look around the world we have now one of the toughest, if not the toughest jurisdiction on multinational tax avoidance of anywhere in the world.
QUESTION:
And if this new set of papers throws up any of these organisations that haven't been paying their tax what can the tax office to an organisation beyond collecting the tax that is owed?
TREASURER:
The Diverted Profits Tax enables them to apply a penalty rate of tax to any payments that weren't made under our tax law. So, there is both carrot and stick in this. Get your house in order, get your affairs in order and we will work with those organisations to see that is resolved. But for those who want to run and hide and try and shift and sneak about, well you will get hit with a diverted profits tax which I announced in my first Budget and it came into effect on 1 July this year.
QUESTION:
So, the fact that there were only 19 companies, do you think that the ATO has taken action in relation to these sorts of schemes? Is that a small number do you think?
TREASURER:
The ATO has been very proactive in this area and our Government has given them the resources and the powers to be proactive in this area. It is important to note that with these papers there will be issues that are raised that are not illegal but there are others that will warrant further inquiry. Wherever that is needed the ATO will be into it, they will be after it and that is exactly what I expect them to do.
QUESTION:
One last question when it comes to internationals - the agencies that you deal with - is enough being done with these tax havens? There is a lot of work being done against the grey places and the black places – what is happening with that black money?
TREASURER:
I think one of the most effective uses of the G20's time in recent years has been to deal with this base erosion and profit shifting issue for multinationals. It is one thing for Australia, or the United Kingdom who has also been very active in this area to go one out on this, but when all of these economies start working together, well there are fewer places to run and there are fewer places to hide. So, there has been some very constructive international cooperation on this. Australia has been right at the heart of this, we will continue to be and multinationals should pay their tax and under a Turnbull Government they are.