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Tax avoidance crackdown confirmed

Mike Taylor14 May 2024

The Australian Taxation Office (ATO) has emerged as a funding winner from the Federal Budget, with an additional $187 million being provided from 1 July this year, to detect and prevent fraud.

The Government also announced that it would be extending the Tax Avoidance Taskforce, Personal Income Tax Compliance Program and Shadow Economy Compliance Program.

The Assistant Treasurer and Minister for Financial Services, Stephen Jones said that measures were aimed at levelling the playing field for those who do the right thing – something expected to improve the Budget by $2.7 billion over the forward estimates.

Jones also confirmed that the Budget included initiatives to strengthen the foreign residential capital gains tax rules to ensure foreign residents paid their fair share of tax in Australia.

He said this would Australia into line with international best practice, which would improve the Budget by $592 million.

He said the Government was also introducing a new penalty for multinationals that attempt to avoid Australian royalty withholding tax by understating royalty payments or seeking to disguise them as something else, to ensure they pay their fair share of tax.

The new multinational penalty will be supported by reforms to strengthen transparency about the use of subsidiaries and stop multinationals from claiming excessive debt deductions to reduce or wipe out tax in Australia, which have passed Parliament.

“The Albanese Government will soon introduce legislation to implement reforms relating to public country by country reporting and a Global Minimum Tax and Domestic Minimum Tax,” he said.

“Tax reform measures in this Budget will boost the bottom line and make the tax system fairer, and the tax cuts will help families, communities, women, and young people as well as business and the economy.”

Mike Taylor

Mike Taylor

Managing Editor/Publisher, Financial Newswire

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