Wednesday, October 15, 2014

Australia has the right idea on tax cheats

Australia has a problem: big corporations cheating on their taxes. So, the Australian Senate has asked them to front up and explain to Australians why they shouldn't pay their fair share:

Forty of Australia's biggest companies will be asked to explain their tax affairs to a Senate committee investigating corporate tax avoidance.

Companies shown, in a recent report, to have the lowest "effective tax rate" over the past decade and to operate the most subsidiaries in tax havens have been given the chance to outline their tax strategies before the committee decides which corporate leaders to call in to appear before public hearings.

The Senate can subpoena witnesses and committee chairman Sam Dastyari has vowed to use that power if the inquiry encounters resistance from big business.

Companies that will be invited to explain their persistently low tax contributions, according to the report, include shopping centre company Westfield, building products firm James Hardie, motorway group Transurban, Sydney Airport, Telstra, SingTel and Echo Entertainment, owner of Sydney's Star casino.

And suddenly, tax cheating has a reputational cost, and voters can see exactly what sort of selfish pricks do it.

I would love for our Parliament to do the same. But can you really imagine a National government hauling its donors and cronies before the Finance and Expenditure Committee to explain why they're laundering their money in the British Virgin Islands? No, I can't either. Because our government is on the side of the tax cheats, not us.