Tuesday, 14 August 2018
Consideration by Estimates Committees
I seek leave to amend general business notice of motion No. 937 standing in my name for today concerning an order relating to company tax returns.
I move the motion as amended:
That the Senate:
(a) notes that:
(i) on 30 May 2018, at an estimates hearing of the Economics Legislation Committee (the Committee), Senator Patrick asked the Australian Tax Office (ATO) whether Goldman Sachs' Australian entities had filed a tax return between 2000 and 2012,
(ii) in responding to the Committee, the Commissioner of Taxation submitted that information about identifiable taxpayers is subject to public interest immunity and that tax return lodgement information of the kind sought is "protected information" under taxation confidentiality laws in Division 355 of Schedule 1 to the Taxation Administration Act 1953,
(iii) this is not an accepted ground of public interest immunity – the Senate derives its inquiry powers directly from the Constitution,
(iv) section 355-60 of Schedule 1 to the Taxation Administration Act 1953 places a legislative restraint on information being disclosed by the ATO to ministers "whether or not provided to a Minister in the course of, or for the purposes of or incidental to, the transacting of the business of a House of the Parliament or of a committee of one or both Houses of the Parliament", however, that provision includes a note that states "This subsection does not limit the operation of section 16 of the Parliamentary Privileges Act 1987 in any other respect" – that section continues to operate, for example, to enable taxation officers to disclose protected information to a committee of one or both Houses of the Parliament, and
(v) in circumstances where a company does not lodge a tax return, they are in breach of the law, and their entitlement to any "unreasonable invasion of privacy" public interest immunity claim is extinguished; and
(b) orders the Commissioner of Taxation to provide to the Economics Legislation Committee, by 5 pm on 15 August 2018, information regarding which financial sector entities that at some stage between 2000 and 2016 had an annual turnover of $100 million or greater, and any related entities of those financial sector entities regardless of turnover, which:
(i) did not lodge tax returns during that period, and
(ii) did not report nil tax payable during that period.
Taxpayers provide their information to the Australian Taxation Office in the knowledge that its confidentiality is protected by law, except in very limited specified circumstances. It has been decades since taxpayer information has been disclosed in parliament. The circumstances at that time involved serious tax evasion and organised crime matters that had been the subject of judicial decision or commentary. The government opposes this motion as it will open the door to ever-present parliamentary speculation and inquiry into taxpayer affairs. The ATO can penalise taxpayers that do not lodge a tax return. The government has increased the penalties on large multinationals that do not lodge a return up to half a million dollars.
Labor will support this motion as amended. The exchange in Senate estimates between Senator Patrick and the Commissioner of Taxation was isolated to an individual entity. We appreciate the Commissioner of Taxation's position in regards to that specific line of questioning by Senator Patrick. The motion as drafted, however, has a public interest rationale. The motion targets a type of behaviour rather than a specific entity. The motion is targeted at a sector, the financial sector, which is under the scrutiny of a royal commission and remains a topic of public interest. The motion also limits the order to documentation relating to firms that have, at some stage in the past 18 years, had a turnover of $100 million or more. In government, Labor legislated for the public release of tax data for public and private firms with revenue of $100 million or greater. The motion as drafted is similar in spirit to such transparency initiatives and, by being limited to large firms, has a public interest rationale.
I'd like to point out that this motion does not require the disclosure of any information by a company that has behaved lawfully in respect of their taxation. It only requires the tendering of information to the Senate for companies that have not complied with the law.