Multinational tax dodging is an increasingly prominent issue on the national and global agenda. A survey conducted by accounting firm BDO earlier this year found that multinational tax avoidance was the number one tax concern for Australians.
The federal government has taken steps in recent months to tackle multinational tax dodging. In April, assistant treasurer Kelly O’Dwyer expressed a verbal commitment to create a public registry that identifies the real owners of companies.
However, the federal government’s official statement at a global anti-corruption summit in May was less definitive.
“Australia is committed to exploring, via public consultation, options for a beneficial ownership register for companies,” the statement said.
Tax dodging deprives the world’s poorest people of essential services such as water, sanitation, healthcare and education. A report released by Oxfam this month revealed the impact of tax avoidance at home and abroad.
“The Australian government and many OECD member countries have been working to reduce the tax losses that result from multinational tax avoidance. However, the vast majority of measures neglect the impact on developing countries,” the report said.
Australia’s neighbours in the Asia-Pacific region are among those hardest hit by multinational tax dodging.
The report estimates USD $172 billion in tax revenue was diverted away from developing countries in 2014. Developing countries lose more money every year through corporate tax dodging than they gain through international aid.
Australian-based multinational corporations alone are responsible for depriving developing countries of approximately USD $2.3 billion in tax revenue annually.
Papua New Guinea is one of the poorest countries in the Asia-Pacific region. Just less than 40 per cent of its population live below the poverty line. Australia is Papua New Guinea’s main trading partner but Oxfam estimates US$12 million is lost every year due to Australian-based multinationals diverting their profits offshore.
The synod of Victoria and Tasmania is a member of the Tax Justice Network, which campaigns for a more transparent and equitable global tax system. Oxfam urged the federal government to fulfil its commitment to create a public registry of beneficial owners, a call echoed by the synod’s Justice and International Mission (JIM) unit.
The JIM unit has launched a petition calling on the Senate to establish this public registry and ensure Australia’s current company registry remains in public hands. If the registry is sold into corporate hands, it will be easier for shell companies with hidden ownership to be registered in Australia.
The petition also calls on the Senate to introduce laws that protect and reward whistleblowers who expose wrong-doing in the private sector, mirroring the protections currently given to public servant whistleblowers.
You can sign the JIM unit petition at http://www.justact.org.au/the_panama_papers_petition
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