Tech giants face tax scrutiny under proposed laws

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Tech giants face tax scrutiny under proposed laws

Australia makes transparency move.

Technology suppliers face closer scrutiny of their local tax affairs after the Australian Government moved to introduce new laws to combat profit shifting and other tax minimisation strategies.

Assistant treasurer David Bradbury told parliament this morning that there is "growing concern" that tax laws are out of step "with the evolution of the global economy".

"The apparent ease with which some large corporate entities can shift taxable profits and erode a country's tax base, is a shared concern for this government, the G20 and most OECD countries," Bradbury said.

"Policy makers and the Australian public should have more transparency around the levels of tax being paid by large and multinational businesses in Australia, to allow for an informed debate about the efficiency and the equity of our tax system."

Under schedule five of the Tax Laws Amendment (2013 Measures No. 2) Bill 2013, data from the tax filings of companies with annual incomes in excess of $100 million would be published by the Tax Commission.

A report by the Guardian Australia earlier today — prior to the bill being introduced to parliament — indicated that, if approved, the amendment could impact up to 2000 companies operating locally.

Bradbury was quoted by the Guardian as "astonished to learn" of Apple's complicated tax structure, which has earned the company the ire of US authorities.

Apple paid only $40 million in tax in Australia in 2011 despite achieving record revenues of $6 billion.

Google has been similarly under fire in Australia and overseas this year over the amount of tax it pays, compared to advertising revenue.

Treasury has been canvassing the issue since the release of a discussion paper earlier this month.

"By increasing the transparency of our business tax system, the Government will ensure that the public is well informed about the contributions made by large corporations," Bradbury told parliament today.

"This is also intended to discourage aggressive tax minimisation practices by large and multinational businesses."

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