Changes In International Taxation Demanded In Australia

by Mary Swire, Tax-News.com, Hong Kong

18 March 2002

A top tax expert in Australia has revealed that average income taxpayers are paying more in tax than multi-millionaires in many cases.

Professor John Braithwaite, of the Australian National University's Centre of Tax System Integrity, has just completed a study on international tax evasion, in which he suggested that the tax departments of some of the country's largest businesses are often generating a profit for the organisation.

'There are quite a lot of people with wealth of more than $30 million who pay less than $20,000 tax each year, which is a lot less than many households on an average income pay,' the Professor announced in a statement released on Friday. 'Average earning people actually pay more tax in absolute terms than some of the wealthiest people in Australia.'

The reason for this, according to Professor Braithwaite, is that whilst wealthy individuals and large companies can afford financial advice on highly effective tax minimisation strategies, ordinary taxpayers do not have the resources to minimise their tax burden.

The report's author called for the Government to urgently reform international taxation laws in order to prevent Australian businesses from flouting the rules, and urged international cooperation on the issue, arguing that without a concerted effort to clamp down on tax evasion at an international level, public support for the tax system will be eroded.

'We need to change our enforcement strategies to become more sophisticated and make sure they address matters like tax havens and tax evaders,' he concluded.

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