The Australian Taxation Office (ATO) intends to enter into discussions with about 80 multinational enterprises expected to be affected by an antiavoidance law introduced into Parliament in September which, if passed, will become effective January 1.
Commissioner of Taxation, Chris Jordan, said the government expects some companies will restructure their affairs in response to the law.
“We have already been approached by some of the large companies that this will directly impact and are commencing discussions right now as to how some of these structures may be unwound without in itself triggering some sort of tax liability,” Jordan said.
The antiavoidance bill is designed to tax profits of large multinationals from Australian sales that are booked offshore.
Jordan said it not yet possible to figure out how much revenue will be derived from the companies under the law. While it appears that billions of dollars of sales are booked overseas that are potentially subject to the law, the ATO must also figure the correct level of expenses under the transfer pricing laws that the MNEs must pay for the intellectual property and for services carried out overseas, Jordan said.
Jordan also said there is no intention to “name and shame” the companies that must change their structures or pay tax under the antiavoidance law.
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