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2016 Budget must close multinational tax loopholes

4 May 2016

2016 Budget must close multinational tax loopholes

The Government can follow Australia’s lead and close the loopholes multinational companies are using to avoid paying their fair share of tax, the Green Party said today.

New measures announced in Australia’s 2016 Budget include penalising companies caught shifting profits out of Australia at a rate of 40%, rather than the usual 30% rate. The Australian Tax Office will also get a 1,000-person strong team of tax avoidance specialists who will target large companies and wealthy individuals avoiding tax.

“New Zealand is increasingly looking like a soft touch for big foreign-owned companies seeking to pay as little tax as possible here,” said Green Party Co-Leader James Shaw.

“New Zealand is losing up to $1 billion of lost tax revenue a year from the likes of companies like Apple, Facebook, Pfizer, and ExxonMobil.

“New Zealand companies and SMEs can’t avoid paying their taxes – large multi-national companies operating here should pay their fair share as well.

“By not moving swiftly, the Government is undermining the integrity and fairness of the tax system for everyone.

“The Australian Government is already booking an extra $3.9 billion over the next four years from the measures it’s taking to make multinational companies pay their fair share of tax.

“There’s nothing stopping New Zealand’s government from similarly getting tough on multinational tax avoidance. Instead, all we see is the Government defending tax avoidance and dragging their feet on reform, hiding behind the excuse that we can’t move until the OECD comes to a consensus on the issue.

“The IRD warned the government in 2013 that multinationals were avoiding tax so they have had three years to get on top of this issue and do something smart about it.

“We don’t need to keep waiting for the OECD to start collecting tax from multi-national companies. It’s time for New Zealand to play catch-up with Australia.”

ends

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