Australia is following the path of the United Kingdom and is planning to create a public register that will unmask the shell company owners who take advantage of tax avoidance by the international companies.
The Guardian reported that the Canberra government has expressed on making a public commitment to put the name of beneficial ownership in the register within weeks before London hosts an anti-corruption conference in the middle of May as confirmed by British Prime Minister David Cameron.
The decision followed the Panama Papers leakage that showed over 800 Australians were helped by the law firm Mossack Fonseca and supported the companies’ tax avoidance deeds. The files leaked to the International Consortium of Investigative Journalists and revealed the names of the world’s richest people who used the complicated structure of shell companies to hide their illegal money in offshore accounts.
The intention of the government behind taking such step is to make sure Australia works in accordance with the G20 commitments that requires corporate transparency, thereby making it easier for the Australian Securities and Investments Commission (ASIC) to track the illegal tax avoidance matters.
Assistant Treasurer Kelly O’Dwyer has confirmed that the measures will be announced soon in the coming weeks. “We agree there needs to be a registry of beneficial ownership in our country,” O’Dwyer told The Guardian in an interview. “It does improve transparency. It means that the public and law enforcement agencies know who ultimately controls the company. It means it is a lot easier to expose wrongdoing or fraudulent conduct. It makes it much easier to disrupt illicit financial flows and it makes it much, much harder to engage in tax avoidance.”
The Labor Party has not yet committed to the creation of the public register.
Oxfam Australia Chief Executive Helen Szoke said that it is the first positive step taken by Prime Minister Malcolm Turnbull’s government. “What we have right now is a financial system that allows big business and the super-rich, here and abroad, to hide millions of dollars that they should be paying in tax,” Szoke said as quoted by news.com.au. “Tackling tax evasion is an opportunity to deliver more revenue for the Australian national budget to spend on health and education while also helping some of the extremely poor nations that were our closest neighbours.”