Miscellaneous 2013

Opinion piece: Who is really to blame for base erosion?

Source: Taxation In Australia Journal Article

Published Date: 1 May 2013


Recently, we have seen comments from government and other sources about multinationals who are said to “shirk” the obligation to pay their “fair share of tax” in the context of press reports about multinational IT companies and how little Australian tax they pay on profits from sales to Australians. The underlying problem is base erosion, that is, reduction of Australia’s tax base by citizens dealing directly with overseas suppliers, who do not pay Australian tax the way their domestic competitors do.

This is not new; legislators and administrators have known of the problem, and possible solutions, for a long time. However, we seem to be witnessing a pattern of careful demonisation of taxpayers, whereas the real problem, in the author’s opinion, is lack of results from those responsible, including ministers from both sides of politics, for administration of the tax system over the last 15 years.

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Miscellaneous 2013

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