CANBERRA: Australian tax commissioner Chris Jordan has said that Australian Taxation Office is on track to recoup $1 billion in revenue from companies.
The political pressure on the Tax Office and Treasury to stop companies such as Apple, Google and Microsoft from shifting profits to low-tax or no-tax jurisdictions has increased, with the head of Treasury’s revenue group Rob Heferen confirming that Australia could move ahead of the OECD’s work, as tasked by G20 governments, to stop tax evasion.
Overall there were 41 audits, which indicates that given only one-third of them have been finished, more revenue could follow. These 41 audits had been identified from more than 150 reviews of large companies since 2013. The former Labor government gave the Tax Office about $225 million in funding over four years to increase surveillance and stamp out corporate tax avoidance. Under this funding, which ends in 2016-17, the target was to recoup $1 billion in revenue. “We’re fairly confident on the billion-dollar figure over the life of the program, and we’re a quarter of the way there,” Mr Jordan said.
Mr Jordan said the ratings were determined around August to September each year and communicated through letters to company chief executives before the end of the year. He said it was good news that companies had moved off the top rating and into lower ratings, as it meant they had been more “transparent” with the Tax Office about their affairs.
Of the 5600 disclosures made, there were 800 taxpayers identified as “wealthy” Australians, and 140 as “highly wealthy”. The agency is also bringing ex big four accountants to help conduct multinational audits. Its submission to the Senate inquiry into corporate tax avoidance states that last year the agency recruited 80 specialists from the private sector to help with audits and tax law. Mr Jordan told Senate estimates ex big four accountants with specialist expertise had been “worthwhile” in helping “identify and zero in on issues”.
He said if they continued raising money from the program targeting multinationals, known as “international structuring and profit-shifting” there was “a very strong case” for further funding. Many companies including Toll, Asciano, Mirvac, Lend Lease, Macquarie Bank, IBM Australia and a host of others have made submissions to the Senate inquiry into corporate tax avoidance, identifying their ratings, and they fact that they have a “good working relationship” with the ATO. The Tax Office also revealed in its recent annual report that its settled cases worth hundreds of millions of dollars with large companies.