Sydney, July 2 (ANI): Australian government has reportedly formed a new Tax Office in order to investigate some of the biggest companies operating in the region for allegedly dodging fair taxes by moving their profit centres overseas.
According to Sydney Morning Herald, the Tax Office will work with international partners and investigate whether highly profitable international companies doing business in Australia, such as Google and Apple, are deliberately avoiding Australian tax by moving their profit centres overseas.
Tax Commissioner, Chris Jordan said that it will involve multi-country audits to expose evidence of profit shifting and will investigate clients of big businesses.
These major companies have been criticized in the recent past over evading fair and legal taxes by shifting their profit centres to places like Ireland which has a low company tax rate and is the location of a Google subsidiary that the company says sells advertising to customers in Australia, through another subsidiary in Singapore.
The report said that Google paid just 74,000 dollars in Australian tax in 2011 despite earning 2 billion in revenue from Australian ads additionally despite the company being criticized in US and Britain over its tax strategies; Australia did not investigate the company yet.
Apple too follows a similar path by using the strategy of selling its products made in China to Apple retailers in Australia after an Irish subsidiary takes ownership of them, on paper, to collect the profits.
According to the report, almost two-thirds of Australia's top 100 companies listed on the stock exchange had subsidiaries in tax havens or low-tax jurisdictions.
Jordon refused taking names of these companies and said that full public disclosure of company tax payments is not the answer and added that it is up to the government to decide launching an inquiry, the report added. (ANI)