Christopher Back (WA, Liberal Party) Share this | Hansard source

Don't talk to me about debt.

I do agree with Senator Hanson-Young, as everyone else does, that it is only fair that multinational companies pay their tax. But it is interesting that that $2 billion a year that the tax commissioner thinks multinationals are not paying is about six weeks interest on Labor's debt from 2007 to 2013. In a speech the taxation commissioner made on 16 March, he really advised us where the real figures lie. He said, 'Yes, it's probably the case that multinationals are avoiding about $2 billion a year in tax and I will tell you how this government is working to make sure they pay the lot.'

But the taxation commissioner said that it is average Australians who are actually costing the budget about $19.7 billion in claims they should not be making for work-related expenses. He said that is by far and away the largest component. He said the second biggest component is:

… a willingness on the part of ordinary Australians to ignore the tax evasion implicit in paying cash for a kitchen renovation or cheap meal.

So $24 billion to $25 billion each year is lost to the Australian economy as a result of people willing to participate in the cash market. His projection is it is about $2 billion a year. Tax Commissioner Jordan said:

Getting every single dollar out of multinationals and large corporates is not going to make a dent.

The biggest of all is individuals, wage and salary earners, claiming work-related expenses. So that's what we've actually got to focus on—

in this country.

It is interesting that Senator Singh came into this place and criticised the coalition government, because in 2015, when the Turnbull government introduced the multinational anti-avoidance law, which I will refer to as MAAL—a piece of legislation expected to claw back about $2 billion under its crackdown on multinational tax avoidance this year—where was the Australian Labor Party? It is a shame Senator Singh is not here to answer the question. Because the Labor opposition opposed it, we required the support of the Greens political party to get that legislation passed. Labor were very happy to allow the multinationals to continue to avoid paying that tax. It is interesting that they have some chance of redeeming themselves—

Senator Dastyari interjecting—

Senator Dastyari, this time around. This year the Turnbull government has introduced the Treasury Laws Amendment (Combating Multinational Tax Avoidance) Bill 2017. It gives the Labor opposition the opportunity to realise their sinful ways and, in fact, this time around to support that legislation. It is nowhere near as effective as the MAAL legislation, which this year will claw back about $2 billion, but at least the new combating multinational tax avoidance bill will yield some hundreds of millions of dollars.

In the time available to me I will make a few points about who pays tax in this country. Who are the two biggest taxpayers in this country? Are they the banks? No, they are not. Are they the insurance companies? No, they are not. As Senator Smith knows only too well, the two biggest taxpayers in this nation come from our home state of Western Australia. By a country mile is BHP Billiton, which paid in 2014 some US$4.9 billion. That was two years ago, so it is probably closer to $6 billion now. When royalties and the resource rent tax are taken into account, BHP Billiton paid more than $8.7 billion, more than A$10 billion at a rate, if you do not mind, of some 45 per cent. As the minister for resources would know, the contribution by the big resources company is massive—US$8.7 billion. I will go to Rio Tinto. In 2015 Rio Tinto paid in Australia US$1.5 billion in tax and $1.4 billion in government royalties to either federal or state government entities. Rio Tinto and BHP pay their fair share.

I listened to the comments made by senators in this place. Once again it is important to understand how misinformation can get out. Regrettably, it was the then member for the Pilbara, Mr Brendon Grylls, who jumped on the figure of 50c a tonne for iron ore in Western Australia and invited the entire Western Australian community to believe that the only figure paid per tonne of iron ore by the two majors, BHP and Rio, was 50c. Well, here are the facts. In fact, enough people in the Pilbara must have believed him, because Mr Grylls is no longer the member for the Pilbara. Those two companies pay about $18 per tonne for iron ore, not 50c a tonne. Of that $14 is tax, about $4.50 per tonne is paid as a royalty depending on the price and, lo and behold, at the bottom of it all is a figure of 50c. So what did Mr Grylls do? He grabbed hold of the 50c and conveniently forgot the $17.50 and ran the line that the only figure that BHP and Rio Tinto pay is 50c a tonne. The community of Western Australia has spoken and have a very good idea on Mr Grylls's contribution. It was his own electorate that voted him out the other day.

I will go to other multinationals that seem to be the subject of a lot of scrutiny: Chevron and its partners on Gorgon and Wheatstone on the North West Shelf—Gorgon on Barrow Island and Wheatstone near the town of Onslow. Here are some figures just to alert you to the value of multinational investment in this country. Some $60 billion—not million; $60,000 million—has been paid of local content to the Australian economy in the construction phase of the Wheatstone and Gorgon projects to date. Over the 30-year life of Gorgon and Wheatstone, it is predicted that there will be a contribution to Australia's GDP of over $1 trillion, more than 150,000 full-time equivalent jobs and $340 billion to federal government revenue. Already in the town of Onslow—which, as Senator Smith and I know, is just a small regional town—some $250 million of social infrastructure has gone into Onslow.

So this is the level of investment. Is there anything else in Australia like this? A hundred billion dollars has been invested by Gorgon and their partners in those two projects. Let me put US$100 billion into perspective—that is A$130 billion. If the Snowy Mountains scheme were built today, it would be a A$9 billion project. Contrast that with A$130 billion in just two projects alone, as Australia goes to being the biggest LNG exporter.

You will hear commentary on the petroleum resource rent tax. Remember: that is a super profits tax, on top of the normal taxes paid by multinationals. You should know that better than anybody.