Government enforces new corporate tax transparency regime

Detailed summary

A new reporting regime is forcing large multinationals operating in Australia to disclose their activities, income and taxes, which the government describes as an "important…

A new reporting regime is forcing large multinationals operating in Australia to disclose their activities, income and taxes, which the government describes as an "important milestone" in corporate tax transparency.

Under the new reporting regime administered by the Australian Taxation Office (ATO), large multinational groups with annual global income of at least $1 billion and an Australian presence must publicly disclose detailed information about their international operations.

The ATO's first tranche of reporting, Public country-by-country (CBC), covers 201 Australian-headquartered businesses and 181 foreign-headquartered businesses, reveals revenues, profits, income taxes, employee numbers and tangible assets across the country and 40 specified jurisdictions.

The first release covers businesses with a June 30 financial year end. More reports, including from many foreign-headquartered multinationals, are expected to be published in May 2027.

Many foreign-owned businesses have a December 31 year end and will be included in the next release.

For the first time, Australians can see where hundreds of major multinationals operating in Australia make their profits, employ their workers and pay their taxes around the world, assistant minister for productivity and competition Andrew Leigh said.

"Australians expect large multinationals to pay their fair share of tax. Businesses doing the right thing deserve a level playing field, and transparency helps expose arrangements that might give others an unfair advantage," he said.

"Multinational profits can travel halfway around the world without a suitcase. Now Australians can see where those profits are booked, and how much tax is paid there."

Where a company reports substantial profits in a low-tax jurisdiction but has relatively few employees or physical assets there, the public can now scrutinise that discrepancy.

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