World’s Giant Tech Companies Face Tax Investigation In Australia

Tax authorities in Australia are investigating the world’s 4 largest companies that include Apple, Facebook, Google and Microsoft amidst new evidences that they are shifting money to offshore tax havens. Executives from the 4 companies appeared before a highly anticipated public hearing on corporate tax evasion to answer questions why revenue generated in Australia ended up elsewhere.

According to Daniel Goff, Microsoft’s corporate VP of worldwide tax, part of the $1.8 billion revenue that was generated from Australia was transferred to Microsoft’s regional headquarters in Singapore and Ireland to fund research and development. He also revealed that Microsoft has reached a last-minute confidential settlement with Australian Tax Office (ATO) before the hearing. However, Chris Jordan, ATO commissioner said that the meeting was awfully coincidental.

Chris Jordan told the inquiry that enough is enough and he is fed up with corporate taxpayers who opt to engage in tactical behaviour to avoid tax obligations.  He has publicly accused the global corporate giants of shrinking their tax obligations to Australia.

Meanwhile, Ted Price, the global VP of tax and treasury for Facebook confirmed that ATO was actually conducting an audit on the US-based tech company for the years that it has been operating in Australia. He said that Facebook advertisers have to meet personally with the company at their offices in Sydney and Melbourne so that the advertising revenue can be booked in Australia for taxation purposes.

Last year, Facebook paid $3.4 million in taxes but comments suggest that actual figures from Australian advertising could be larger than the sudden revenue increase recorded by the company after ATO crackdown. Independent senator Nick Xenophon said that Facebook’s $327 million revenue claim is not credible. In a separate inquiry, evidence provided by Professor Mark Ritson showed that $6 billion in advertising revenue is being divided between Facebook and Google Australia.

When a client is facing tax investigation from the revenue authorities, the best option is to suggest chartered accountant insurance to cover the substantial professional fees that may be incurred during the audit activity. The cost involved in proving that the client has complied with various tax and legislative requirements can be quite considerable.

Share

Comments are closed.

Want help? Email Us Here! Chat With Us Now!

← Prev Step

Thanks for contacting us. We'll get back to you as soon as we can.

Please provide a valid name, email, and question.

Powered by LivelyChat
Powered by LivelyChat Delete History