The Turnbull Government has moved to strengthen rules that ensure multinational companies pay their fair share of tax.
The Government today introduced legislation to extend the reach of its successful Multinational Anti-Avoidance Law (MAAL), honouring a commitment made in the 2017-18 Budget.
This legislation extends the Multinational Anti-Avoidance Law to corporate structures that involve:
- Foreign resident partners;
- Trusts that have any foreign resident trustees or beneficiaries; or
- Foreign trusts that temporarily have their central management and control in Australia.
The MAAL took effect from 1 January 2016 and prevents multinationals from escaping Australian tax by using artificial or contrived arrangements to avoid having a taxable presence in Australia.
To date the Australia Taxation Office has identified 38 large companies that have brought or are bringing their sales to Australian customers onshore in response to the MAAL. As a result the ATO expects an additional $7 billion in income each year will be returned to the Australian tax base.
This legislation reinforces our commitment to tackling multinational tax avoidance.
The Turnbull Government has already taken significant action to shut down loopholes and tackle tax avoidance head on. This includes introducing a strong Diverted Profits Tax and establishing a Tax Avoidance Taskforce in the Australian Taxation Office.
By ensuring multinationals and individuals pay their fair share of tax, we ensure the sustainability of our tax system so that we can fund the infrastructure and services needed by Australians.
The Government would like to take the opportunity to thank those who contributed to the consultation process.