Profit shifting under microscope in senate inquiry

A SENATE inquiry will examine the tax arrangements of the biggest technology companies in the world today.

The tactics used by companies to minimise their Australian tax bills will be under the spotlight, as well as what more could be done to ensure multinationals pay their way.

After Treasurer Joe Hockey pushed at last year’s G20 for stronger international overseeing of profit shifting, the Greens-initiated inquiry aims to investigate the matter publicly.

Companies including Google, Apple and Microsoft, as well as major mining firms and Rupert Murdoch’s News Corporation will give evidence this week.

Submissions to the inquiry show some transparency from companies including BHP Billiton over and above those required, while Apple gave little information.

A letter from Apple to the inquiry noted it had an expired agreement with the tax office on its tax obligations, and it had an “effective tax rate” above 30% in Australia.

That was despite a series of recent reports the company was shifting profits from Australian sales overseas through complex offshore financial arrangements.

The inquiry will also hear from the tax office and other government agencies, and is expected to release a final report to parliament in June.