The Greens have today struck a last minute compromise deal with the Turnbull Government to address multinational tax avoidance, which will see multinational companies with a global turnover of $1 billion or more being required to prepare “general purpose” financial statements that disclose greater detail about their affairs.
The exemption for privately owned companies publicly disclosing their tax bills has also been lifted from revenues of $100 million a year to $200 million, in turn capturing an additional 281 companies. From The AFR:
The government had sought to shield about 900 privately held Australian companies from being included in a Tax Office report giving a breakdown of taxable income and tax paid.
The amendment means only 600 companies will be shielded.
“It will expose the 281 largest companies previously shielded by the government’s [bill]…otherwise known as the ‘kidnap law,” the Greens said in a statement.
The party has ridiculed concerns raised by some that such disclosures would put the rich families behind those companies at greater risk of being kidnapped by money-hungry criminals.
The Greens agreement means that the Better Targeting the Income Tax Transparency Laws Act will pass the Senate today – the final sitting day of the year – and will come into effect on January 1, as intended.
MB supports greater disclosure from large companies. Democracy works best when there is transparency. And shielding large companies from publicly disclosing their tax payments breaches this fundamental requirement.
Some of the excuses used against public exposure were also utterly ridiculous and included:
- Risk of kidnapping.
- Breaching the human right of privacy.
- Information could be used to exert commercial pricing or other leverage or advantages over companies.
- Reputational damage or additional costs to protect reputation.
- Eroding public confidence in the integrity of the tax system.
- A family company’s children and adults will be burdened by people seeking money and undue harassment.
It is only fair that Australian taxpayers know whether large companies are also paying their fair share of tax. It will also help build confidence and integrity in the tax system, which will become more important as workers are called on to pay more and more tax via bracket creep.
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