AMMAN: Tax commissioner Chris Jordan said private companies were just “thrown in” under disclosure laws targeting large companies’ earnings.Tax commissioner Chris Jordan said private companies were just “thrown in” under disclosure laws targeting large companies’ earnings.
Tax commissioner Chris Jordan said laws aimed at requiring the tax office to publish the tax information of large companies were originally intended to capture multinationals, not private companies.
But Labor’s shadow assistant treasurer Andrew Leigh said private companies were a target of the laws when introduced, suggesting it wasn’t appropriate for the commissioner to comment on policy intention.
The Coalition wants to remove about 700 private companies from laws, introduced under the former Labor government, requiring the Australian Taxation Office this year to publish the tax information of public and private companies with $100 million or more turnover.
Prime Minister Tony Abbott has told Coalition party room members the government will wind back tax disclosure laws after complaints by private business owners that they could be kidnapped should tax information be made public and people realised how wealthy they were.
The issues were raised in a party room meeting by several Coalition MPs including Assistant Treasurer Josh Frydenberg. Fairfax Media first reported the concerns raised with the government by private business owners over kidnapping and ransom demands because of the laws.
Asked about the rollback, Mr Jordan, speaking at the Tax Institute conference on Queensland’s Gold Coast, said “it’s clearly a matter for government”.
But he said the laws were originally intended to capture overseas-based multinationals that were not paying tax on billions of dollars of sales in Australia, rather than private business owners.
“I think if you look at the history of the matter, it was really for multinational companies operating here, disclosing quite low revenue,” he said.
“I understand, and this mainly what I’ve read in the media, that there’s a lot of concerns about the private companies [being included] in these disclosures. [There are] personal reasons but also competitive reasons. People saying, well their [private companies’] margins might be looked at. If they’re a major supplier to some of the major retailers there might be pressure on them to reduce their prices.”
The laws, as they stand, require the ATO to publish the Australian business number, total income, taxable income and tax payable of public and private companies with $100 million or more turnover on the data.gov.au website. Business has been lobbying hard against the publication of such information, saying it could be “misleading”.
Introduced under the former Labor government, from July the laws will require the tax office to publish the tax details of thousands of private and public companies with more than $100 million turnover.
The ATO has already said that while the laws are meant to take hold in July, publication is not likely to take place until the end of the year, and that companies will have a chance to check their tax information before it goes live.
Several Coalition ministers including Treasurer Joe Hockey voted against Labor’s laws when in opposition.
“It started out as multinational companies [being forced] to disclose and in some cases to show how low [profits] were in terms of the Australian part of that,” Mr Jordan said. “Notwithstanding there might be billions of dollars of sales here.”
“That was the genesis of it and I suppose then it got widened to include Australian large corporates and got thrown in private companies as well.”
Mr Jordan said Labor had originally set the reporting threshold at more than $100 million, but it was lowered.
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