Assistant treasury minister Andrew Leigh says Labor does not want to see an economy where multinationals see tax loopholes as a “shortcut to success” via “tricky tax arrangements”.
With it having been revealed that Shell is using a marketing hub in Singapore to sell Queensland gas to offshore customers, Leigh says Labor will give the Australian Tax Office (ATO) the resources it needs to pursue the “lurks and loopholes such as marketing hubs” that multinationals use.
From The AFR:
“Multinational corporations making a profit in Australia should pay their fair share of tax in Australia,” Treasurer Jim Chalmers and Assistant Competition Minister Andrew Leigh said in a joint statement on Friday after releasing a Treasury consultation paper into the issue.
“Unlike our predecessors, we won’t let multinationals off the hook when it comes to their tax obligations and ensuring they pay their fair share of tax,” they said.
Cracking down on multinational tax avoidance is certainly a worthwhile goal. But while you are at it, how about cracking down on the ruthless rorting of Australians by the gas cartel, which are making obscene profits selling our gas overseas, driving up domestic prices to nosebleed levels, and paying minimal tax in the process?
The below chart from Alan Kohler, derived from the latest ACCC report, says it all. It shows how LNG prices have rocketed as their costs have remained dead flat. Accordingly, the gas cartel are making super profits while Aussies are paying through the nose to heat their homes, for electricity, or to operate their businesses.
Cartel makes super profits off our gas.
Any crackdown on multinational tax avoidance should first focus on taxing the super profits of the 95% foreign-owned gas cartel.
Simply set a $7Gj price trigger to a domestic reservation regime. As shown above, that’s $2Gj above the cartel’s costs, allowing them to still earn a healthy return, while earning the Australian Budget billions in revenue.
This would effectively return Australian gas to being priced on a utility “cost-plus” basis, as it was before the evil gas cartel began exporting our gas and linking the domestic market to international prices.
Nations like Denmark has accumulated gigantic sovereign wealth funds by treating their gas in this manner. It is time for Australia to do likewise by breaking the evil gas cartel.
