Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I am pleased to speak on this bill, and I am pleased that the Labor Party is supporting transparency for Australian companies regarding their taxation arrangements. This stands in stark contrast to the pathetic and chaotic coalition government who as always are governing in the interests of a wealthy minority. I hazard to predict they may be electing one of those wealthy minorities as the next Prime Minister of the country in the next 24 hours.

The priority of this government is to ensure the interests of this minority are satisfied, and this bill represents a genuflection to the coalition's true masters. Working families are not a priority for this government. Pensioners are not a priority for this government. Growing the economy and employment is not a priority. Investing in education and skills to ensure our future prosperity is not a priority. Ensuring we have great health and disability insurance systems is not a priority. This bill demonstrates again that the priority for the Liberal and National parties is whatever a few wealthy Australians Australia want. This legislation should not pass, as it lessens the improved transparency introduced by the previous Labor government.

The current Prime Minister declared on election night 2013 that Australia was 'open for business'. We know now that he meant that quite literally, and this legislation is clear evidence of a government governing on behalf of a wealthy minority, with no interest in the concerns and aspirations of the of tens of millions of working Australian's that should be their first priority.

Before addressing the flaws in this disgraceful bill, I want to draw to the attention of the House the proud record of the Labor Party in tackling tax avoidance when we were in government. In government we closed loopholes in Australia's transfer pricing rules and antiavoidance provisions. The coalition voted against this. We cracked down on companies overvaluing assets in international transactions. The coalition voted against this. We signed 28 bilateral information sharing agreements with other nation's tax agencies. The tax commissioner has said that better information-sharing with other countries about multinational companies resulted in $730 million in additional tax being collected between 2012 and 2014.

We provided the ATO with $109 million to establish a specific audit program looking at the use of marketing hubs. This program has already resulted in 13 companies being given revised tax bills, worth $250 million. And I want to proudly associate myself with the comments from the member for Lilley regarding the use of marketing hubs in his contribution on this debate.

We amended the Taxation Administration Act to require the ATO to publish information regarding the income, taxable income and tax paid by companies earning over $100 million from 1 July 2015. This is a very substantial record of tackling tax avoidance. Our record should be compared to the government's regarding tax avoidance. One of the very first acts of the Abbott government was to reopen offshore loopholes worth $1.1 billion.

The measure we are debating, regarding the publishing of information regarding the tax that companies pay, was intended to discourage aggressive tax practices, to better inform public debate about tax policy and to assist in combatting the risk of erosion of profit sharing. If this bill does not pass, the first publication of this information based on the 2013-14 financial year will occur later this year.

The current system covers about 2,000 of Australia's largest companies. In this bill the government is seeking to limit the scope so that the laws no longer apply to Australian-owned private companies. It would be interesting to know how many of those companies are Liberal Party donors.

The laws will continue to apply to multinational companies operating in Australia and to Australian public companies. This bill will exclude companies earning more than $100 million from the transparency provisions if the firm is an Australian resident private company, is not a wholly-owned subsidiary of a foreign corporate group and does not have a level of foreign shareholding greater than 50 per cent. Companies that are not corporate tax entities or that report a total income of less than $100 million for an income year will continue to be outside the operation of these laws.

The bill must be opposed because this parliament should not be limiting transparency and the ability of Australians to access information about large and powerful corporations. It is a damning indictment on this government that they are seeking to limit this transparency. There is a very clear distinction between the Labor Party and the coalition: the Labor Party stands for transparency and the coalition stands for secrecy. It is not in the interests of the Australian taxpayers to limit transparency in the area of corporate taxation. The excuses we have heard from the government for why they are doing this are ridiculous. Apparently it is to reduce the risk of kidnapping of wealthy individuals, yet not a single request has been made to the government for this action. An FOI lodged by the Labor opposition revealed not a single communication to the government from a high-wealth individual or from someone who owned an Australian private company saying, 'Please change this law because we are at risk of being kidnapped.' It is a complete furphy designed to reduce the transparency in the Australian taxation system. My question is: what do the coalition have to hide? What do they have to hide in preventing the Australian people from knowing what companies with incomes over $100 million are paying in tax? What is so wrong with that information being out in the public arena?

As I have said previously, this bill tells us what the priorities of the Australian government are. In the area of taxation the government's priority is to limit transparency. The current Treasurer—and he may be Treasurer for less than 12 hours, so it would probably be more accurate to describe him as 'the Treasurer for the time being'—has talked tough on multinational tax avoidance for a long time now. I would have thought cracking down on multinational tax avoidance was a far greater priority than cracking down on corporate transparency—but not for this government. This bill sends a very clear message: 'We are looking after our corporate mates and we have no interest in sensible and rational tax policy.'

Over the last 12 months, through a Senate economics committee investigation, we have seen some very disturbing information about the taxation practices of multinational corporations in this country. I would submit that, if this government were intent on raising revenue and intent on increasing the efficiency and equity of the taxation system, then that is where they should be directing their efforts, rather than attempting to reduce transparency in the taxation system. Unfortunately, throughout history the coalition governments—and the Liberal Party in particular—have deep form on this. Let us not forget that in the 1970s they turned a blind eye to the bottom-of-the-harbour tax avoidance schemes that were rife in the late seventies and early eighties. Those schemes robbed the Australian government of millions, if not billions, of dollars of rightful taxation revenue that the Fraser government did nothing about. It is perhaps ironic that a royal commission into a corrupt trade union—and let us be frank about it, the painters and dockers were corrupt—was the only way we found out about the bottom-of-the-harbour schemes and the illicit activities of so many tax evaders in Australia. The Fraser government was very happy for those tax evaders to continue in their tax evasion until the Costigan royal commission meant they could no longer look the other way.

Then we look at the eighties, which was the golden era of economic reform when the Labor government introduced the capital gains tax—a very important taxation reform. Much to the chagrin of the Liberal Party, this tax was implemented successfully and was opposed by the coalition, by the Liberal Party, by people like John Howard. Former Prime Minister Howard likes to rewrite history and say that somehow he agreed with every sound economic measure around taxation and every other economic policy in the 1980s, but let us not forget that he opposed these very important reforms. Capital gains taxation was brought in over the bodies of the Liberal Party, yet they now try to claim that they were part of some bipartisan reform agenda in the 1980s. They were not. Their record on taxation is appalling: they are happy to turn a blind eye on tax evasion and tax avoidance, they are happy to oppose sensible taxation measures that raise revenue from people who can afford to pay more tax and they are happy to introduce concessions—let us not forget that when the GST was introduced in 1999 they halved the capital gains tax applying for assets held for more than a year. The coalition government have form on reducing the tax burden on wealthy Australians at the expense of average taxpayers in this country.

We are in a period where inequality is at a 75-year high. We should be looking at ways of making the taxation system more efficient and also more progressive. We need to use the taxation system to tackle that inequality, to raise revenue to fund the much-needed services that a Commonwealth government should be funding and to fund important programs to stimulate economic growth in this period when we have a jobs crisis. But all we have on the other side is a plan to reduce transparency in the taxation system, to let private companies that pay more than $100 million in tax not have to disclose information that is pertinent to their records.

An open and transparent system of corporate tax disclosure is necessary for Australians to have confidence in the tax system and to encourage corporate best practice. This bill seeks to narrow the scope of corporate tax disclosure, and the government is to be condemned for attempting to limit the amount of information Australians can access. Labor hopes that the Senate crossbench will join with us on the side of transparency against this shameful attempt to limit the information available to citizens about our largest companies. The bill is a damning indictment and a clear illustration that the Abbott government is on the side of big business and ignores the interests of working Australians. No matter what happens over the next 24 hours with the chaos in the Liberal party room, no matter whether we still have Prime Minister Abbott in 24 hours or—as is more likely—Prime Minister Turnbull, no matter who is Prime Minister, if they are leading a coalition government, rest assured they will be on the side of the wealthy minority. They will be on the side of those who want to not disclose what tax they pay. They will be on the side of those who want to minimise the tax they pay in this country, because their interests are not the interests of the vast majority of Australians. Their interests are the interests of a wealthy minority and, no matter who leads them, that is the story that is there. That is the truth undermining the coalition government, and that is why ultimately they will be defeated.

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