Written Assessment
Worth 25%
Due Friday 15th
May 2020 @ 11.59 pm
Henry told us in his guide to the Institutional Framework of Taxation in Australia that the Australian Taxation System is one of the most complex in the world and is made up of approximately 125 taxes including taxes such as Income Tax, Capital Gains Tax, Fringe Benefits Tax and Goods and Services Tax. He also mentioned that there are many different organisations that play different and important roles within this system to ensure its integrity and that all Australians are treated equally and with equity.
The Australian Taxation System is embedded in the way of life for all Australian taxpayers. We pay tax on our income, we pay tax when we purchase goods and use services, and we pay tax when we sell assets, to name a few. In return the Government provides public services and benefits e.g. hospitals, schools, defence, and financial assistance to those in need etc.
As we know the government relies heavily on the revenue from taxation to be able to finance its activities and the services it offers to the public. As such, reforms and reviews on taxation are often the focus of the Australian government.
Media in Australia and around often contest that large multinationals like Google, Facebook etc., do not paying their share fair of tax to the countries they operate in. The article below is an example of such criticism and explores the decision by Google to pay an extra $481.5m in taxes to settle a decade long dispute with the Australian Taxation Office (ATO) over its Australian tax bill.
https://www.nestegg.com.au/earn-money/tax-refund/google-to-pay-nearly-500m-in-tax-settlement
Your task will be to look at this topical area of taxation and to comply with the instructions below.
Required
This assessment requires you to comment and offer your opinion on the global discussion surrounding the taxing of multinationals and the perceived view they are not paying their correct or fair share of taxation in the countries in which they operate.
One approach, as proposed by the Organisation for Economic Co-Operation and Development (
OECD
) is to introduce a
minimum global rate of tax
on multinationals.
You will need to look at the OCED proposal and voice your opinion on whether you think this is an appropriate way to
You will need to write an essay, of no more than
2,500 words, exploring:
Why the media and Governments are concerned about multinationals paying their fair share of tax. In your essay, you should address questions such as:
1. Why is paying tax important?
2. What is a fair share of tax?
3. What perceived behaviours or attitudes of multinationals are domestic and/or global reforms trying to address?
4. Are these reforms likely to be effective?
Your essay should include examples of where the media have raised the issue that the tax liability of a multinationals is too low compared to the overall profit made by the multinational in your home country (eg Australia, Malaysia, Singapore, Mauritius).
Additionally, you should comment on whether you feel the attention given to multinationals is warranted. I.e. consider:
1. Whether multinationals are doing wrong or whether they are merely, and legally, taking advantage of the tax laws in a specific country (this is your opinion so there is no right or wrong answer).
2. Whether the global minimum tax regime proposed by the OECD is an appropriate measure to address the issue and whether your country is supportive of the proposal. You should also provide your opinion on the OECD proposal, do you think it will work? is it fair? what are some of drawbacks? are multinationals likely to comply with it or will they find other ways to minimise or avoid paying tax?
Formal requirements
Part two requires you to produce a
2500 word essay
on the above points and to express
your opinion
of this topic which should be based on your findings from the articles you have collected and any other research you may want to undertake.
Please do not just provide a detailed summary of the articles you have included in Part One.
You must use complete and attached the cover page (provided on Blackboard) and include a reference list in your essay.
The word limit does not take into account the cover page or references. A maximum excess of 10% is allowed on the word limit.