Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

What a lot of hot air from the Labor Party. The Labor Party say that they want to take action against multinational tax avoidance. It is all talk and no action. Here we have a piece of legislation in front of the parliament, in front of the Senate, which is going to help Australia get its fair share of tax from multinational companies, and the Labor Party say that it is with multinational tax avoiders. That is what the Labor Party are doing. When you hear the yelling, the squealing, the yapping and the barking, it must be very uncomfortable sitting on the sidelines of the public policy debate in Australia. The truth is that Labor, today, continue to stand in the way of stronger action to tackle multinational tax avoidance. The government are committed to taking effective action against multinational tax avoidance, and we are very pleased that the Greens are working with us to help make that happen.

Let me just remind the chamber what this is all about. The government have been working very hard and continue to take strong action to combat multinational tax avoidance. Last year we took action to tighten Australia's thin capitalisation rules to limit the scope for multinationals to claim excessive debt reductions. This bill in front of the Senate today implements the government's 2015-16 budget measures to combat multinational tax avoidance. These measures will force multinational companies with significant activities in Australia to pay their fair share of tax and will level the playing field for all taxpayers.

The new multinational anti-avoidance law will ensure the Commissioner of Taxation can force multinationals that have significant activities in Australia to pay tax on profits from economic activities undertaken here. Multinationals will no longer be able to justify, using contrived schemes, avoiding paying tax. This rule will strengthen our anti-avoidance rules for multinationals by capturing arrangements that are designed to obtain both Australian foreign tax benefits to stop companies claiming they are only seeking to avoid foreign tax and lowering the purpose from sole or dominant purpose to one of the principal purposes and making it easier to apply.

Where a scheme is captured, the Commissioner of Taxation will be able to look through the contrived scheme and apply the tax rules if the multinational made the profit in Australia. This means that they will now pay tax on profits from the Australian activities. Penalties for large companies that enter into tax avoidance or profit-shifting schemes will be doubled from 1 July 2015 and country-by-country reporting will require large multinationals to report additional information to the ATO. This is a significant improvement in transparency and will help the ATO undertake targeted assessments of transfer pricing risk.

This is the legislation that Labor stands against and that the Greens are, today, helping to facilitate through the Senate. Labor can run whatever spin they want to. Labor is standing in the way of that legislation successfully passing the parliament, whereas the Greens are working with the government to make sure that this legislation passes. You can jump up and down and run whatever sort of smoke-and-mirrors campaign you like. We have been able to work with the Greens, positively and constructively, to achieve a beneficial public policy outcome for Australia, which is in our national interest.

We were open to achieving a majority in the Senate with the Labor Party, but the Labor Party was completely not prepared to engage. The Labor Party was standing on the sidelines. In fact, as the Manager of the Government Business confirmed with me this morning, we did not even hear back from the Labor Party in relation to arrangements for the legislative program in the Senate today. That is right, isn't it?