by Alan Thornhill
Rupert Murdoch’s News Limited insists that it is paying a “substantial” amount of tax on its operations in Australia.
In its submission to the Senate Economics Committee, its Chief Executive Officer, Julian Clarke, said News Limited had paid a total of $417.3 million in tax, over the past five years.
This includes withholding tax.
The Committee, which met in Sydney today, is inquiring into allegations of large scale corporate tax evasion and tax minimisation.
Mr Clarke also said News Limited employs “close to 9,000 Australians and paid an additional $900 million in Australians goods and services, fringe benefit and payroll taxes.
He said it provides 15 million Australians with news and information services each week.
A weekend report, in rival 10 Fairfax newspapers, said $4.5 billion had been “siphoned off” from News Limited operations in Australia “virtually tax” free, over the past two years.
A union based organisation, United Voice, told the Committee today that almost a third of the nation’s top 200 firms pay an effective tax rate of 10 per cent or less.
Australia’s corporate tax rate is a flat 30 per cent.
David O’Byrne of United Voice told the Committee that many wealthy corporations are now paying lower rates of tax than their employees.
The Tax Commissioner, Chris Jordan, who also appeared before the Committee today, spoke of disputes the Tax Office now has with several companies, particularly in the communications industry.
“We have 12 significant, deep audits going on right now with 12 major tech companies, challenging what they’ve been putting to us over the years under existing laws,” Mr Jordan said.
But he refused to name the companies involved.
Three global IT giants, Apple, Microsoft and Facebook are also listed to appear before the Committee today.
The Committee will continue its work with hearings in both Canberra and Sydney later this week.
In a statement this afternoon, the Treasurer, Joe Hockey, said:”this Government is working hard to ensure multinationals pay taxes in Australia on the income they earn here.
“Under our leadership, G20 Finance Ministers will continue to tackle base erosion and profit shifting and increase transparency to crack down on tax evasion.
“We have also taken a leadership role in the automatic exchange of tax information, recently signing an agreement with Switzerland, based on the OECD’s common reporting standard.
“We are working closely with other tax administrations, mapping the global operations of multinationals operating in the digital economy.”
Mr Hockey said:”the ATO has strong investigative powers to ensure that multinational companies operating in Australia are paying their fair share of tax.
“With additional resources, the ATO is undertaking more extensive inquiries and audits of multinational companies considered a risk to Australian tax collections.
“The ATO is embedded in the offices of dozens of multinationals operating in Australia.
“By 30 June 2015, the ATO will have conducted around 200 reviews of the highest risk multinationals.
“We need to promote and support this work, not put it at risk,” the Treasurer said.
by Alan Thornhill
The Federal government has backed away from planned cuts to legal aid funding, which would have hit both domestic violence and Aboriginal services.
The Attorney General, George Brandis, announced the decision today.
Senator Brandis told reporters in Canberra that:”those savings would have taken effect on July 1 this year.”
He said that, over the next two years, there would an additional $25.5 million of Commonwealth money for the legal assistance sector.
“That will take the form of three kinds of funding: an additional $12 million over the next two years for the 61 Community Legal Centres.
“An additional $11.5 million over the next two years for the Commonwealth’s Indigenous Legal Assistance Programme.
“And an additional $2 million to restore funding out of the Expensive Commonwealth Criminal Cases Fund to the State and Territory Legal Aid Commissions,” Senator Brandis said.
“These decisions in aggregate will increase the total Commonwealth funding for legal aid from 2013-14 to 2016-17 to $1.37 billion dollars,” he added.
He said they would “entirely restore” the savings that were announced in the 2013 Mid Year Economic and Fiscal Outlook document.
Senator Brandis said the decision, ultimately, had been made by the Prime Minister, Tony Abbott.
The planned cuts had been heavily criticised by the Opposition, State authorities and welfare organisations.
The Chairwoman of National Legal Aid, Gabrielle Canny, said that while the reinstatement of funding to legal aid commissions for expensive Commonwealth criminal cases was welcome, it would not help legal aid commissions with their day-to-day work in family law disputes.
But Shane Duffy, the chairman of the National Aboriginal and Torres Strait Islander Legal Services, said the group was “thrilled” that the cuts would no longer be made.
Weathercoast by Alan Thornhill
A novel on the murder of seven young Anglican Christian Brothers in the Solomon Islands.
Available now on the iTunes store.
Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.
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