Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Hansard source

The details of multinational tax can sometimes be complicated but the principles are straightforward: all firms should comply with the law and pay their fair share of tax. Labor's history on multinational tax is a proud one. In 2013, former Treasurer Swan and Assistant Treasurer Bradbury brought to this place a $4 billion multinational tax package and improvements in tax transparency. Both measures were opposed at the time by the coalition. Upon winning office, the coalition failed to legislate part of that plan. It opposed transparency and, in a dirty deal with the Greens, on the last sitting day of last year, wound back tax transparency.

At every turn, it has been Labor that has led the debate on tax transparency. In the first half of this parliamentary term we put forward a plan that deals with debt deductions and hybrid mismatches and provides the tax office with the resources it needs to deal with multinational tax avoidance. I want to commend Senators Ketter and Dastyari for their hard work in the other place on highlighting the importance of this issue.

The bill that is before the House on the Common Reporting Standard is a bill on which the former Treasurer, Joe Hockey, had to be dragged kicking and screaming into signing Australia up. This bill contains important Labor amendments agreed to by the government last week. Labor amended the bill to bring forward the reporting date so that the Australian Taxation Office can begin exchanging company information sooner—not leaving it until the end of 2019, as the government would have wished. Labor also successfully amended the bill in the Senate to ensure that the tax office publishes an aggregated report of financial Australian holdings by foreign residents from each individual tax jurisdiction. That better ensures public transparency about Australia's place in global money flows. Tax transparency groups have called for these amendments, and Labor was pleased to be able to champion them in the other place.

This morning I moved in this place a private member's bill that will increase the penalties on multinationals for doing the wrong thing—not $5,400, a lower penalty than you would pay for pushing the line in a Gold Coast arts venue or streaking across the SCG, but a more significant penalty of $270,000, which recognises that failing to lodge country-by-country accounts could seriously undermine the integrity of our tax system. I hope those opposite will support my private member's bill as, in the other place, they supported Labor's changes to the Common Reporting Standard.

The issue of multinational profit shifting is not an issue on which Australia is at the vanguard. There are over 40 countries that will begin reporting before Australia does—from the UK to South Africa and from Iceland to India. Australia is not lagging behind those countries because of factors outside our control; we are a laggard because of the choices of the Abbott-Turnbull government. When the group of early-adopter countries laid out their timetable for exchanging information, they called it 'ambitious but realistic'. Labor believes that is the right timetable. But the former Treasurer and the current Treasurer are happy to see Australia drag its heals on the Common Reporting Standard. They would have had us reporting on a timetable with the Bahamas, Russia and the United Emirates. Labor's amendments to this bill have made it a better bill and have ensure that we can report on the Common Reporting Standard appropriate information on an appropriate schedule. Labor will continue to fight for better multinational tax laws.

We do not believe the dirty deal done between the Liberals and the Greens to take two-thirds of large private firms out of the tax transparency net was a good deal for Australians. When we saw the release of the information on public companies last December, Australians learned that one in four big public companies paid no tax. But they will not learn those same details for big private companies, because two-thirds of them have been exempted from transparency laws by the deal done between the Liberals and the Greens. With inequality at a 75-year high, and with a community outcry on multinational tax avoidance, we believe the right thing to do is move quickly on the Common Reporting Standard to improve transparency. We urge the government, as they backed Labor's amendments to this bill, to also support Labor's multinational tax plan. (Time expired)

Question agreed to.

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