Peter Khalil (Wills, Australian Labor Party) Share this | Link to this | Hansard source

Most people pay their fair share of tax, so why should the biggest multinational companies get away with paying zero tax in Australia? One in three medium and large corporate entities paid zero tax in the last year. That's 841 out of 2,700 large and medium-sized corporate entities. In the mining, energy and water sector, more than half of companies paid no income tax. Let's just take a few examples. Chevron paid just $30 in tax. That's off revenue of $9.2 billion. In 2021, Google had an income of more than $7 billion but only paid $85 million in tax, an effective tax rate of only 1.2 per cent compared to the average tax per capita in Australia of nearly 30 per cent. Facebook doubled its profits but funnelled nearly $1 billion in local advertising revenue to an international subsidiary. Facebook Australia's tax bill was $24 million, an effective tax rate of 2.4 per cent. Just last year, Aristocrat made $1.67 billion and paid only $216 million in tax. That's an effective tax rate of 13.6 per cent. Eighty companies have paid zero tax in Australia for six straight years. It's remarkable.

The amount of corporate tax revenue lost annually due to multinationals minimising tax ranges from an estimated $5 billion to $6 billion. This is unacceptable. It's time they pay up. This is an issue I'm passionate about because every dollar lost through tax avoidance tactics is money lost to our kids' education, housing, health care, protecting our natural environment, looking after older Australians in their retirement, the NDIS and reducing the cost of child care. Australia needs to lead the way with tax avoidance legislation. I've been speaking on this issue for years on behalf of every worker, every small-business owner and every person in my community who is worse off because companies making huge profits in Australia using their armies of tax lawyers to avoid paying their fair share of tax.

The fact is that small businesses don't have the option to route their sales through Ireland, Singapore or the Cayman Islands. They don't have a subsidiary to which they can charge a licence fee to ensure they never turn a profit. They are stuck with paying their PAYG and quarterly BAS while the multinational companies play a shell game with their profits. If they're not paying, we are. If your average punter is paying their 32c in the dollar out of their salaries in tax, surely it's not too much to ask that some of the biggest companies in the world pay their fair share in Australia, a country where they are making a profit? If you'll allow me some poetic licence, if we are the villagers down on the ground, toiling away—the salary earner, the wage earner and the small-business owner—paying our fair share of tax, the multinationals are the dragons flying above us, swooping down to collect their gold and loot and winging it back to their tax haven lairs across the ocean. I've written about this. It's a very important issue. We need to be more ambitious on this reform.

I'm so pleased the Albanese government is taking concrete action through ambitious reform, including passing the Treasury Laws Amendment (Making Multinationals Pay Their Fair Share—Integrity and Transparency) Bill back in 2023, forcing the multinationals in Australia to operate with transparency and honesty, forcing them to disclose information about their subsidiaries in their financial reports and making sure that they're replacing their current asset tests and thin capitalisation rules with OECD recommended earning based tests. These are important measures for transparency and accountability.

This is a huge international issue. The biggest barrier we face is a lack of political courage, but the Labor government has the courage to take on these corporations and stop them shirking their obligations to the Australian people. There's more to do. This is just the start. Over the past decade, there have been a number of significant international attempts towards structural reform of the international tax system. President Biden has backed the OECD initiative of a global minimum tax to help nations recapture the estimated $130 billion to $300 billion in taxes that are lost every year through tax avoidance tactics.

Imagine what we could achieve as a global community with these additional billions spent on education, health care and the environment. Multinational dragons will likely lash out with their fire and smoke. We should not be afraid, because the whole world needs action on this. The unfairness cannot continue. We need to play our part, drawing on Australia's legacy of leading the way on significant international reforms. I would say that, if we can shackle those dragons, it will enable us to better fund essential public services well into the 21st century. Thanks to the actions of the Albanese Labor government, multinational companies are finally going to start paying their fair share of tax.