Footnotes

Chapter 1 - Background to the inquiry

[1]        Journals of the Senate, No. 59, 2 October 2014, p. 1588.

[2]        Journals of the Senate, No. 59, 2 October 2014, p. 1588.

[3]        OECD urges stronger international co-operation on corporate tax, 12 February 2013, http://www.oecd.org/ctp/oecd-urges-stronger-international-co-operation-on-corporate-tax.htm (accessed 30 July 2015).

[4]        Committee Hansard, 9 April 2015, p. 59.

[5]        The Honourable Tony Abbott MP, This Year's G20: Getting the Fundamentals Right, Address to the World Economic Forum, Davos Switzerland, 23 January 2014.

[6]        Tax Justice Network—Australia, Who Pays for Our Common Wealth, October 2014.

[7]        See, for example, Health Aston and Georgia Wilkins, 'ASX 200 company tax avoidance bleeds Commonwealth coffers of billions a year, report finds', Sydney Morning Herald, 29 September 2014; and 'Tax Justice Network report reveals tax burden shifting from companies to ordinary taxpayers', www.news.com.au, 29 September 2014.

[8]        Submission 56, p. 3.

[9]        General anti-avoidance provisions are outlined in Part IVA of the Income Tax Assessment Act 1936.

[10]      See, for example, Publish What You Pay, Submission 30; ActionAid Australia, Submission 67; and Uniting Church of Australia, Synod of Victoria and Tasmania, Submission 74.

Chapter 2 - Overview of Australia's corporate tax system

[1]        Treasury, Risks to Australia's Corporate Tax Base, Scoping Paper, July 2013, p. 11.

[2]        By contrast, individual and 'passive' business income is taxed on a worldwide basis and, as such, is levied on total assessable income regardless of the jurisdiction in which it is sourced. The Board of Taxation, Review of Debt and Equity Tax Rules: Discussion Paper, March 2014.

[3]        Answer to Question on Notice No. 14, p. 1.

[4]        Property Council of Australia, Submission 18, p. 5.

[5]        Property Council of Australia, Submission 18, p. 5.

[6]        ATO, Submission 48, pp. 6–7.

[7]        Australian Government, Re:think—Tax Discussion Paper, March 2015, p. 76.

[8]        ATO, Submission 48, pp. 5–6.

[9]        ATO, Submission 48, p. 5.

[10]      According to the ATO, net income tax payable in 2012–13 was $63.3 billion whereas company income tax collections were $66.9 billion. Tax payable represents the tax obligation for the year (calculated after the tax return is completed) whereas tax collected represents the tax collected during the year (PAYG instalments, wash-up payments and refunds).

[11]      Committee Hansard, 8 April 2015, p. 19.

[12]      ATO, Submission 48, p. 7.

[13]      ATO, Submission 48, p. 10.

[14]      ATO, Submission 48, p. 12.

[15]      ATO, Submission 48, p. 12.

[16]      ATO, Submission 48, p. 12.

[17]      Australian Government, Re:think—Tax Discussion Paper, March 2015, p. 75.

[18]      Australia's Future Tax System Review Panel, Australia's Future Tax System, 2 May 2010, p. 159.

[19]      Treasury, Pocket guide to the Australian taxation system 2012–13, 2013, p. 3.

[20]      Australian Government, Re:think—Tax Discussion Paper, March 2015, p 85.

[21]      Australian Government, Re:think—Tax Discussion Paper, March 2015, p. 21.

[22]      Australian Government, Re:think—Tax Discussion Paper, March 2015, p. 75.

[23]      OECD, OECD Tax Database, http://www.oecd.org/tax/tax-policy/tax-database.htm (accessed 19 March 2015). Data presented is for 2014 and reflects combined state and federal corporate income tax rates (where levied).

[24]      Mr Grant Wardell-Johnson, KPMG, Committee Hansard, 9 April 2015, p. 9.

[25]      BHP Billiton, Answer to Question on Notice No. 14, 24 April 2015, p. 1.

[26]      See, for example, the Review of Australia's Future Tax System, p. 155; and The Australia Institute, Submission 62, pp. 4–6.

[27]      Submission 48, p. 10.

[28]      BHP Billiton, Answer to Question on Notice No. 14, 24 April 2015, p. 1.

[29]      Australian Government, Re:think—Tax Discussion Paper, March 2015, p. 92.

[30]      ATO, Submission 48, p. 10.

[31]      ATO, Answer to Question on Notice No. 7, p. 3.

[32]      Submission 48, p. 10.

[33]      ATO, Answer to Question on Notice No. 7, p. 11.

[34]      ATO, Submission 48, p. 10.

[35]      Submission 48, p. 11.

[36]      ATO, Answer to Question on Notice No. 7, p. 3.

[37]      Uniting Church of Australia, Synod of Victoria and Tasmania, Submission 74, p. 3 and Action Aid Australia, Submission 67, p. [2].

[38]      Treasury, Addressing profit shifting through the artificial loading of debt in Australia, Proposals Paper, 14 May 2013, p. 1.

[39]      Treasury, Addressing profit shifting through the artificial loading of debt in Australia, Proposals Paper, 14 May 2013, p. 1.

[40]      Submission 74, p. 3.

[41]      Minerals Council of Australia, Submission 54, p. 2.

[42]      The committee notes that this definition may change as a result of the proposed introduction of the Multinational Anti-Avoidance Law.

[43]      Submission 42, p. 4.

Chapter 3 - Evidence of corporate tax avoidance and aggressive minimisation

[1]        See, for example, Ms Michelle De Niese, Corporate Tax Association, Committee Hansard, 10 April 2015, p. 56.

[2]        Submission 48, p. 34.

[3]        Submission 33, p. 2.

[4]        Submission 15, p. 9.

[5]        Submission 53, p. ii.

[6]        Submission 74, p. 3.

[7]        Committee Hansard, 8 April 2015, p. 62.

[8]        Submission 39, p. 3.

[9]        Submission 67, p. 2.

[10]      Submission 56, pp. 9–10.

[11]      Submission 48, p. 22.

[12]      OECD, BEPS – Frequently Asked Questions, http://www.oecd.org/ctp/beps-frequentlyaskedquestions.htm#background (accessed 30 July 2015).

[13]      ATO, Submission 48, p. 25.

[14]      Submission 48, pp. 23–24.

[15]      Economics Legislation Committee, Estimates Hansard, 2 June 2015, p. 15.

[16]      Submission 74, p. 5.

[17]      Submission 93, p. 1.

[18]      Committee Hansard, 8 April 2015, p. 11.

[19]      Submission 74, pp. 3–4.

[20]      Submission 48, p. 19.

[21]      OECD, BEPS—Frequently Asked Questions, http://www.oecd.org/ctp/beps-frequentlyaskedquestions.htm#background (accessed 30 July 2015).

[22]      OECD, OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrators, July 2010, p. 19.

[23]      OECD, OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrators, July 2010, p. 19.

[24]      Submission 87, Attachment 3, p. 1.

[25]      Committee Hansard, 8 April 2015, p. 15.

[26]      OECD, OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrators, July 2010, pp. 59–60.

[27]      OECD, OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrators, July 2010, pp. 59–60.

[28]      Apple Australia, Submission 66, p. [2]; Answer to Question on Notice No. 17, 28 April 2015,
p. 3.

[29]      Committee Hansard, 8 April 2015, p. 46.

[30]      Apple Australia, Answer to Question on Notice No. 17, 28 April 2015, p. 1.

[31]      Apple Australia, Answer to Question on Notice No. 17, 28 April 2015, p. 2.

[32]      Mr Chris Jordan, Committee Hansard, 22 April 2015, p. 2.

[33]      Mr Tony King, Committee Hansard, 8 April 2015, p. 49; Mr Mark Konza, Committee Hansard, 22 April 2015, p. 9.

[34]      Supplementary Submission 103.1, p. 2.

[35]      Answer to Question on Notice No. 14, p. [i].

[36]      Answer to Question on Notice No. 14, p. 1.

[37]      Committee Hansard, 10 April 2015, p. 62.

[38]      Answer to Question on Notice No. 14, p. 1.

[39]      Answer to Question on Notice No. 14, pp. 2–3.

[40]      Committee Hansard, 10 April 2015, p. 65.

[41]      Committee Hansard, 10 April 2015, p. 65.

[42]      Mr Phil Edmands, Committee Hansard, 10 April 2015, p. 68.

[43]      Mr Chris Jordan, Committee Hansard, 22 April 2015, p. 4.

[44]      Committee Hansard, 8 April 2015, p. 44.

[45]      Committee Hansard, 8 April 2015, p. 51.

[46]      Committee Hansard, 22 April 2015, p. 2.

[47]      Committee Hansard, 8 April 2015, pp. 42–43.

[48]      Answer to Question on Notice No. 11, p. 1.

[49]      Committee Hansard, 8 April 2015, pp. 43, 50.

[50]      Committee Hansard, 8 April 2015, p. 43.

[51]      Answer to Question on Notice No. 33, p. 2.

[52]      Answer to Question on Notice No. 33, p. 2.

[53]      Answer to Question on Notice No. 22, p. [1].

[54]      Answer to Question on Notice No. 11, p. 1.

[55]      N. Chenoweth, 'Yes, Google does pay tax on $2 billion in revenue: $5 million in Singapore', Australian Financial Review, 13 April 2015, http://www.afr.com/technology/technology-companies/google/yes-google-does-pay-tax-on-2-billion-ad-revenue-5-million-in-singapore-20150414-1mjymy (accessed 2 June 2015).

[56]      Mr Bill Sample and Ms Maile Carnegie, Committee Hansard, 8 April 2015, p. 49; Mr Mark Konza, Committee Hansard, 22 April 2015, p. 9.

[57]      Submission 48, p. 26.

[58]      Economics Legislation Committee, Estimates Hansard, 16 February 2012, p. 128.

[59]      Economics Legislation Committee, Estimates Hansard, 2 June 2015, p. 22.

[60]      Treasurer, Australia's Foreign Investment Policy, June 2015, p. 7.

[61]      Submission 87, p. 8.

[62]      Dr Roman Lanis and Mr Ross McClure, Submission 75, pp. 58–70.

[63]      Submission 87, p. 9.

[64]      Tax Justice Network Australia, Who Pays for Our Common Wealth? Tax Practices of the ASX 200, October 2014, p. 13.

[65]      Tax Justice Network Australia, Who Pays for Our Common Wealth? Tax Practices of the ASX 200, October 2014, p. 7.

[66]      Submission 87, p. 14.

[67]      Committee Hansard, 9 April 2015, p. 18.

[68]      Economics Legislation Committee, Committee Hansard, Supplementary Estimates 2014-15, 22 October 2014, p. 167.

[69]      Tax Justice Network Australia, Who Pays for Our Common Wealth? Tax Practices of the ASX200, October 2014, p. 9.

[70]      ATO, Answer to Question on Notice No. 18, 1 May 2015, p. [3].

[71]      ATO, Answer to Question on Notice No. 18, 1 May 2015, p. [4].

[72]      Submission 48, p. 3.

[73]      Committee Hansard, 9 April 2015, p. 18.

[74]      Submission 93, p. 1.

[75]      Submission 91, p. 4.

[76]      Submission 91, pp. 3–4.

[77]      CPA Australia, Submission 73, p. [2].

Chapter 4 - Multilateral initiatives to address avoidance and aggressive minimisation

[1]        Global Value Chains: Challenges, Opportunities, and Implications for Policy, Report prepared for submission to the G20 Trade Ministers Meeting, Sydney, Australia, 19 July 2014, p. 7.

[2]        OECD, OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrators, July 2010, p. 17.

[3]        Business Council of Australia, Submission 87, p. 12.

[4]        OECD, Submission 85, p. 1.

[5]        Committee Hansard, 9 April 2015, p. 59.

[6]        Submission 87, p. 12.

[7]        OECD, Submission 85, p. 1.

[8]        Business Council of Australia, Submission 87, p. 12.

[9]        OECD, Submission 85, p. 1.

[10]      Submission 85, p. 1.

[11]      OECD, Submission 85, p. 2.

[12]      Mr Rob Heferen, Committee Hansard, 9 April 2015, p. 18.

[13]      Committee Hansard, 9 April 2015, p. 61.

[14]      Committee Hansard, 8 April 2015, p. 9.

[15]      OECD, Submission 85, p. 2.

[16]      OECD, Submission 85, p. 2.

[17]      Mr Pascal Saint-Amans, Committee Hansard, 9 April 2015, p. 59.

[18]      OECD, Submission 85, p. 3.

[19]      OECD, Submission 85, p. 3.

[20]      OECD, Submission 85, p. 3.

[21]      OECD, Submission 85, p. 3.

[22]      Mr Pascal Saint-Amans, Committee Hansard, 9 April 2015, p. 60.

[23]      OECD, Submission 85, p. 3.

[24]      See, for example, evidence provided by Professor Richard Vann, Professor Kerrie Sadiq and Associate Professor Antony Ting, Committee Hansard, 8 April 2015, pp. 9–18.

[25]      Submission 85, p. 2.

[26]      Committee Hansard, 9 April 2015, pp. 60–61.

[27]      Submission 87, p. 4.

[28]      Submission 55, p. 7.

[29]      Submission 67, p. [2].

[30]      Committee Hansard, 8 April 2015, p. 9.

[31]      Mr Robert Heferen, Committee Hansard, 9 April 2015, p. 18.

[32]      Submission 33, p. 5; Submission 73, p. [2]; Submission 59, p. 13.

[33]      Australian Government, Fairness in Tax and Benefits, Budget 2015–16, p. 8.

[34]      Committee Hansard, 8 April 2015, p. 10.

[35]      Committee Hansard, 9 April 2015, p. 60.

[36]      Committee Hansard, 8 April 2015, p. 11.

[37]      Committee Hansard, 9 April 2015, p. 62.

[38]      Submission 87, p. 13.

[39]      Submission 55, p. 7.

[40]      Submission 74, p. 170.

Chapter 5 - Potential areas of unilateral action to protect Australia's revenue base

[1]        Committee Hansard, 9 April 2015, p. 64.

[2]        Treasury, Risks to the Sustainability of Australia's Corporate Tax Base, Scoping Paper, July 2013, p. 45.

[3]        Answers to questions on notice received from Associate Professor Antony Ting, 23 April 2015, p. 2.

[4]        Submission 59, p. 11.

[5]        Submission 87, p. 5.

[6]        Economics Legislation Committee, Estimates Hansard, 22 October 2014, p. 149.

[7]        Submission 68, p. 2.

[8]        Submission 81, p. 2.

[9]        Submission 81, p. 2.

[10]      Mr Rob Heferen, Committee Hansard, 9 April 2015, p. 25.

[11]      Submission 74, pp. 4–5.

[12]      Committee Hansard, 9 April 2015, p. 18.

[13]      Rio Tinto, Taxes Paid in 2013, p. 1.

[14]      ATO, Tax secrecy and transparency: administrative arrangements for reporting entity information—ATO consultation paper, March 2015, https://www.ato.gov.au/General/Consultation/What-we-are-consulting-about/Papers-for-comment/Tax-secrecy-and-transparency--administrative-arrangements-for-reporting-entity-information---consultation-paper-March-2015/ (accessed 16 June 2015).

[15]      Treasury, Better Targeting the Income Tax Transparency Laws, http://www.treasury.gov.au/ConsultationsandReviews/Consultations/2015/Better-targeting-the-income-tax-transparency-laws (accessed 13 August 2015).

[16]      Supplementary Submission 74, p. 1.

[17]      Consultation on tax integrity proposals, Letter to Mr Michael Andrew, 12 May 2015.

[18]      Australian Government, Fairness in Tax and Benefits, Budget 2015–16, p. 8.

[19]      See, for example, Community and Public Sector Union, Submission 14; United Voice, Submission 78; and Uniting Church of Australia, Synod of Victoria and Tasmania, Submission 74.

[20]      Supplementary Submission 78, p. 3.

[21]      Supplementary Submission 74, p. 3.

[22]      Supplementary Submission 74, p. 3.

[23]      Supplementary Submission 74, p. 3.

[24]      Submission 56, pp. 5, 8.

[25]      OECD, BEPS Action 7: Preventing the Artificial Avoidance of PE Status, Revised Discussion Draft, 15 May 2015 – 12 June 2015, p. 1.

[26]      HM Revenue and Customs, Diverted Profits Tax, Consultation Draft, 10 December 2014, https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/385741/Diverted_Profits_Tax.pdf (accessed 6 May 2015).

[27]      HM Revenue and Customs, Diverted Profits Tax, Consultation Draft, 10 December 2014, https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/385741/Diverted_Profits_Tax.pdf (accessed 6 May 2015).

[28]      Committee Hansard, 8 April 2015, p. 16.

[29]      Mr Mark Konza, ATO, Committee Hansard, 8 April 2015, p. 32.

[30]      Committee Hansard, 9 April 2015, p. 7.

[31]      Committee Hansard, 9 April 2015, p. 65.

[32]      Australian Government, Budget 2015: Fairness in Tax and Benefits, May 2015, pp. 7–8.

[33]      Tax Laws Amendment (Tax Integrity Multinational Anti-avoidance Law) Bill 2015, Explanatory Memorandum, p. 22.

[34]      Tax Laws Amendment (Tax Integrity Multinational Anti-avoidance Law) Bill 2015, Explanatory Memorandum, p. 6.

[35]      Australian Government, Budget 2015: Fairness in Tax and Benefits, May 2015, p. 7.

[36]      Tax Laws Amendment (Tax Integrity Multinational Anti-avoidance Law) Bill 2015, Explanatory Memorandum, p. 5.

[37]      Australian Government, Budget 2015: Fairness in Tax and Benefits, May 2015, p. 7.

[38]      Australian Government, Budget 2015–16: Budget Measures—Budget Paper No. 2¸ pp. 14–15.

[39]      Economics Legislation Committee, Estimates Hansard, 2 June 2015, p. 42.

[40]      Economics Legislation Committee Estimates Hansard, 2 June 2015, p. 39.

[41]      Economics Legislation Committee Estimates Hansard, 2 June 2015, p. 42.

[42]      Committee Hansard, 9 April 2015, p. 36.

[43]      Submission 94, p. [1].

[44]      Submission 94, p. [2].

[45]      Submission 94, p. [2].

[46]      Submission 98, p. [1].

[47]      Submission 98, p. [1].

[48]      Committee Hansard, 8 April 2015, pp. 63, 68.

[49]      Australian Government, Budget 2015–16: Budget Measures—Budget Paper No. 2¸ pp. 20–21.

[50]      Australian Government, Budget 2015: Fairness in Tax and Benefits, May 2015, p. 5.

Chapter 6 - Facilitating government agencies to collect corporate tax and protect public revenue

[1]        Submission 48, p. 3.

[2]        Submission 48, p. 14.

[3]        Submission 48, pp. 24–25.

[4]        Submission 48, p. 17.

[5]        Submission 48, p. 17.

[6]        The number of lower risk corporations increased markedly in 2014 due to organisational realignments.

[7]        Committee Hansard, 22 April 2015, p. 15.

[8]        Committee Hansard, 22 April 2015, p. 15.

[9]        Submission 48, p. 18.

[10]      Submission 48, pp. 18–19.

[11]      ATO, Submission 48, p. 29.

[12]      ATO, Submission 48, p. 30.

[13]      Project Wickenby is a cross-agency initiative established in 2006 to protect the integrity of Australia's financial and regulatory systems by preventing people from promoting or participating in the abusive use of secrecy jurisdictions.

[14]      Committee Hansard, 22 April 2015, p. 2.

[15]      Submission 14, p. 8.

[16]      Submission 48, p. 30.

[17]      Committee Hansard, 8 April 2015, p. 30.

[18]      Committee Hansard, 22 April 2015, p. 2.

[19]      Committee Hansard, 8 April 2015, p. 33.

[20]      Committee Hansard, 8 April 2015, p. 34.

[21]      ATO, Submission 48, pp. 30–31.

[22]      Submission 91, p. 8.

[23]      Submission 14, p. 9.

[24]      Committee Hansard, 8 April 2015, p. 26.

[25]      Committee Hansard, 8 April 2015, p. 19.

[26]      Submission 48, p. 34.

[27]      Submission 91, p. 7.

[28]      Committee Hansard, 8 April 2015, p. 17.

[29]      Mr Mark Konza, Committee Hansard, 22 April 2015, p. 8.

[30]      Committee Hansard, 8 April 2015, p. 21.

[31]      OECD, Action 13: Country-by-Country Reporting Implementation Package, OECD/G20 Base Erosion and Profit Shifting Project, 2015, p. 5.

[32]      OECD, Action 13: Guidance on the Implementation of Transfer Pricing Documentation and Country-by-Country Reporting, OECD/G20 Base Erosion and Profit Shifting Project, 2015, p. 4.

[33]      Committee Hansard, 8 April 2015, p. 20.

[34]      Committee Hansard, 8 April 2015, p. 20.

[35]      Submission 32, p. 3.

[36]      Submission 32, pp. 3–4.

[37]      Submission 32, p. 6.

[38]      Submission 32, pp. 6–7.

[39]      Submission 32, p. 7.

[40]      Section 181 of the Corporations Act.

[41]      Submission 32, p. 21.

[42]      For more information about the conditions relating to grandfathered large propriety companies, see Exemption from having to lodge a financial report for 'grandfathered' large proprietary company, http://asic.gov.au/regulatory-resources/financial-reporting-and-audit/preparers-of-financial-reports/large-proprietary-companies-that-are-not-disclosing-entities/exemption-from-having-to-lodge-a-financial-report-for-grandfathered-large-proprietary-company/ (accessed 9 August 2015).

[43]      Recommendation 15, Financial System Inquiry, Financial System Inquiry Final Report, November 2014.

Additional Comments from the Australian Greens

[1]        'Starbucks pays UK corporation tax for the first time since 2009', BBC News, 23 June 2013;  Simon Bowers, 'Amazon to begin paying taxes on UK retail sales', The Guardian, 23 May 2015.

[2]        Ben Butler, 'Glencore to close down Singapore Trading Hub', The Australian, 10 April 2015.

[3]        Neil Chenoweth, 'Rupert Murdoch's News Corp is ATO's top-tax risk', Australian Financial Review, 11 May 2015.

[4]        Heath Aston, 'Energy Company's $11 billion transfer to Singapore rings tax avoidance alarm bells', Sydney Morning Herald, 4 April 2015.

Appendix 3 - The metric

[1]        This effective tax borne formula was provided to the committee by the Australian Taxation Office in an answer to a question on notice following the public hearing on 22 August. See Australian Taxation Office, Answer to Question on Notice No. 18.