Nick McKim (Tasmania, Australian Greens) Share this | Hansard source

You are a fair man, Acting Deputy President; I'm sure all your colleagues would agree. I withdraw those comments.

Gas companies are cooking our planet. They are literally rendering it uninhabitable for human life. They're failing to pay a fair share of tax. They shift their profits offshore. They avoid paying super profits tax, and many of them are only now starting to pay company tax after the ATO beat Chevron in the High Court in 2017 regarding Chevron's practice of shifting large amounts of debt onto their Australian companies. Let's be very clear about this: the multinationals who own and operate so much of the gas cartel in this country are running rings around Australia's tax law. They are using every trick in the book, and the Labor Party has no interest whatsoever in calling them to account and ending those practices. The ATO's court actions have in many ways already corrected the more egregious debt-shifting behaviour of the gas companies.

This bill implements a policy that both the Greens and the Labor Party took to the election: to limit the tax deductions that global corporations can make when they lend themselves money, which is what goes on all the time. Lending yourself money is an absolutely basic and fundamental strategy of tax dodgers. It's been made famous by gas companies in Australia who borrowed money from their parent company at a rate well above commercial rates—let's say 10 or 11 per cent—so that all the profits made in Australia are whittled down to nothing while the parent company, which is often miraculously based in tax havens like the US state of Delaware or Ireland or the Netherlands, makes extraordinary profits, which are of course not taxable in Australia. We all know how this stuff works. The difference is that some of us are prepared to stand up, call it out and take it on, but most of us are not. By shifting the test from assets to income, this bill implements the OECD's base erosion and profit-shifting program. However, quite predictably, the government has selected the weakest end of the range recommended by the OECD at 30 per cent of earnings before interest, taxes, depreciation and amortisation.

Another time-honoured tactic of tax avoiders and tax dodgers that isn't covered by this bill is the use of price misallocation, where, instead of related companies providing loans to themselves, they sell the product to themselves. Rio Tinto made the Singapore sling famous by selling Australian minerals to their own marketing hubs based in low-tax jurisdictions. The profits, of course, accrue then to the marketing company, while the Australian extracting company miraculously fails to turn a profit.

There is also a massive loophole being inserted into this bill by Labor that undermines the entire purpose of changing the test. Companies will be able to carry forward any deductions over that 30 per cent that I mentioned earlier into future years—for 15 years! In other words, the bill isn't actually going to stop excessive deductions; it is just spreading out the time that that tax avoidance can occur over many years. So to say that this bill doesn't meet the Greens' expectations is putting it mildly—and that was before Labor amended it late last year to further weaken those carry-forward debt deduction rules and reduce the power of the ATO to deny corporate deductions that are not made for valid commercial reasons. What an absolute shambles this is. What a clown show this Labor government is. What a bunch of patsies to the big tax-dodging corporations and the gas cartel this Labor Party is.

I do want to acknowledge there were some improvements in the government amendments to support investment in large renewable energy projects as well the plantation industry. That will obviously be a necessary part of ending native forest logging around the country. This gives me an opportunity to acknowledge the absolutely incredible work done by my friend and colleague Senator Janet Rice. She has been a key part of the campaign, along with activists around the country, to end native forest logging in Australia. She's an awesome voice for voiceless threatened species that are being logged into extinction, like the swift parrot in my home state of Tasmania, and around ensuring that we acknowledge that plantations do have a key role to play in the transition out of native forest logging. Now, plantations are a unique industry; they have very long lead times and they do need unique financing structures that, at times, clash against some of the debt tests in this bill.

I want to be clear: the Australian Greens are considering our position on legislation. There are some small steps forward in this bill, but there are other steps that take us backwards. We want to take a considered approach to this legislation. We do want to be constructive, but we also want to ensure that we are making laws in this place that will see big corporations pay more tax. It's time that the big corporate tax avoiders in this country were held to account. It's time that big corporations were forced to pay their fair share of tax so we can invest in things that allow more and more Australians to lead good and dignified lives, like putting dental and mental health into Medicare, like rising income support, like ensuring that child care is more affordable and like wiping student debt. Those are the things that we should be doing, and we should be making the big corporations pay for it.