The leakage of the Panama Papers is fuelling a debate between major Australian political parties over tax avoidance.
Australia deputy opposition leader Tanya Plibersek said that hundreds of Australians have been named in the leaked documents for not showing their actual wealth, thereby hiding their share of tax payment. “We have got evidence today of hundreds more Australians that are structuring their finances, perhaps some of them for legitimate reasons, but others perhaps making use of offshore tax havens to avoid paying their fair share,” she said as quoted by The Guardian.
“That affects us all. It is hard to pay for our health and education and other investments in our community if very large companies and high net wealth individuals aren’t paying their fair share. We know that ordinary wage and salary earners don’t get to restructure their affairs so they can avoid paying tax because they have set up in some tax haven overseas.”
Treasurer Scott Morrison said that the federal government has seen an uplift of $400 million since 2014 after the collapse of multinational tax avoidance. “We’ve got tax treaties, swap agreements on information with over 100 countries to crack down on these sorts of things,” he said. “So, our record, when it comes to tax avoidance, and particularly multinational tax avoidance, is one of legislation and action.” He also criticised the Labor party for not voting against the tax avoidance bill passed in December.
The debate is all about whether Australia has been putting efforts to hide its tax faults. The Australia Taxation Office has identified a total of 800 individual taxpayers, of whom 77 Australian clients were found involved in tax avoidance. The Guardian Australia and the ABC analysed the Panama papers and found that Panamanian law firm Mossack Fonseca is one of the most secretive companies in the world that has aided its clients in laundering money and avoiding tax by hiding their actual wealth record.
The company, however, has claimed that it has been operating for 40 years and has never been alleged of wrongdoing. German newspaper Süddeutsche Zeitung obtained the files and shared the same with the International Consortium of Investigative Journalists (ICIJ). ICIJ Director Gerard Ryle said that the papers contained day to day business of the Panamanian secretive company for the past 40 years. “I think the leak will prove to be probably the biggest blow the offshore world has ever taken because of the extent of the documents,” BBC quoted him as saying.