Combating tax avoidance

Ensuring everyone pays the right amount of tax

Cracking down hard on tax avoidance

Like any Australian family or business, the Government is focused on living within our means by keeping expenses down to balance the budget and to pay down debt.

By avoiding their full tax responsibilities and by using aggressive tax minimisation schemes, individuals and companies not paying their tax are hurting the budget and reducing vital funding for the Australian community.

The Government is taking on those individuals and companies who seek to avoid paying tax. The tax avoidance game is up.

A new Diverted Profits Tax

This Budget introduces a new Australian Diverted Profits Tax. The Diverted Profits Tax will impose a 40 per cent penalty rate of tax on multinational corporations that attempt to shift their Australian profits offshore to avoid paying tax.

If multinational corporations seek to short-change Australia they will pay a penalty.

Together, the Multinational Anti Avoidance Law (MAAL) put in place last year and the new Diverted Profits Tax are expected to raise around $650 million over four years from large multinationals.

The Government is ensuring businesses pay the right amount of tax in Australia when they do business in Australia.

New measures to counter tax avoidance

The Government will introduce additional new measures to protect Australia’s tax base, enforce compliance and provide transparency.

A newly established Tax Avoidance Taskforce will provide the ATO with greater firepower to crack down on tax avoidance by businesses, multinationals and high wealth individuals.

The Tax Avoidance Taskforce is expected to raise $3.7 billion in additional Government revenue.

The Government will also strengthen the protections for whistleblowers who come forward and report tax avoidance, introduce laws to require tax advisers and promoters of tax schemes to disclose reportable tax schemes to the ATO, and strengthen transfer pricing rules to reduce opportunity for companies to avoid paying tax on business activity in Australia by shifting profits offshore.

The package contained in this Budget of corporate tax integrity, compliance and transparency measures will help achieve the Government’s goal of having Australia as the world leader in the global fight against tax avoidance.