Senate debates

Wednesday, 1 October 2014

Questions without Notice

Taxation

2:15 pm

Photo of Christine MilneChristine Milne (Tasmania, Australian Greens) Share this | | Hansard source

My question is to the Minister Assisting the Treasurer, Senator Cormann. In light of a report by the independent Inspector-General of Taxation, which warned the Abbott government that the Australian Taxation Office was ill equipped to tackle a potential multibillion dollar international tax dodge as it prepared to cut 3,000 ATO staff, can the minister explain how the government expects to crack down on corporate tax cheats when it is sacking the very public servants who have the experience and capacity to do the work?

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

The first point I would make is that the tax office has well in excess of 20,000 staff. The second point I would make is that the staffing efficiencies in the tax office were actually initiated by the previous Labor-Green government. You come in here on your high horse and attack us for efficiencies in the tax office that were initiated by the government that you were a part of. The third point I would make is that we support those efficiencies because we happen to think that the tax office in 2014 can do its job better and in a more efficient way with less manpower because of all the opportunities that we have these days through modern technology and the like to manage compliance work in this space in a less manually intensive way. To think that in order to improve compliance you need more bodies sitting at desks completely ignores the way that compliance in the modern tax system is properly managed.

I want you to get away from the proposition that somehow the tax office is not doing a good job. The tax office is doing a very good job, but this is always a very dynamic area. Clearly, there is a creative tension. The tax office has the job of raising revenue consistent with the laws of the land, and people out there who are responsible for paying tax will try to find ways to legitimately minimise their tax obligations. As these sorts of developments happen it is our job to monitor developments in the market and to respond to them as appropriate and as they occur. I reject completely out of hand the suggestion that somehow the tax office is not doing a good job. We have an outstanding tax commissioner. Chris Jordan, who was appointed by the previous government, is doing an outstanding job.

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | | Hansard source

Mr President, I raise a point of order on standing order 186(1). I find it exceedingly difficult to hear when the good senator is addressing the end of the chamber.

Photo of Stephen ParryStephen Parry (President) Share this | | Hansard source

There is no point of order. The senator is not in breach of standing order 186.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

The policy objective is clear, we want all businesses and indeed all taxpayers— (Time expired)

2:18 pm

Photo of Christine MilneChristine Milne (Tasmania, Australian Greens) Share this | | Hansard source

Mr President, I ask a supplementary question. The report also suggests that many of the tax office's most experienced staff have since moved to the four big accounting firms, where they now advise the nation's biggest companies on how to minimise their tax. Does the minister accept that the loss of these transfer-pricing experts has posed a serious threat to Commonwealth revenue and a built-in conflict of interest as the tax office outsources company tax audits to them?

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

No.

Photo of Christine MilneChristine Milne (Tasmania, Australian Greens) Share this | | Hansard source

I am glad that the minister has confirmed that there are no personnel or technology constraints and no conflicts of interest. Mr President, I ask a further supplementary question. At a time when money flowing between Australian companies and their foreign subsidiaries has topped $270 billion, will the government commit to introducing legislation to require Australian corporations to disclose all foreign subsidiaries in their financial statements?

2:19 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

We in Australia are at the global leading edge when it comes tax administration, when it comes to making sure that we raise the revenue the government needs in the most efficient way possible. Let me just say that I find it very difficult to take Senator Milne's question seriously, because Senator Milne leads the party which tells us that it is now in favour of regular reductions in the tax on fuel. Senator Milne leads the party which is telling us that not only is it appropriate that the tax on fuel has fallen as a proportion of the average fuel price at the pump, from 42 per cent down to 25 per cent, she wants to see regular reductions every six months. She has backbenchers briefing the media saying, 'The coalition doesn't talk to us about how to get our support.' Senator Milne must have kept secret the fact that we had meetings where I put it to her that we could reach an understanding around good public policy to ensure there is regular indexation of fuel, so do not come in here and talk about that. (Time expired)