Costello Pledges International Tax Reform

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

21 September 2004

Australian Treasurer Peter Costello has indicated that he wants to overhaul the country’s international taxation system to ease the tax burden on firms operating overseas if the ruling Liberal/National coalition retains power after October’s general election.

Speaking to the Financial Times, Costello revealed that one of his top priorities is to help firms that derive much of their income overseas and pay tax on it but do not benefit from a domestic tax credit.

"I would like to improve Australia's international taxation arrangements so that Australian companies can expand in foreign jurisdictions, while remaining domiciled in Australia," Costello told the FT.

"We want to promote Australia as a place for regional headquarters - for Australian companies but also for foreign companies," he added.

Costello spoke as News Corp, the largest firm listed on the Australian Stock Exchange, prepares to move its domicile and primary listing to the United States.

The government's plans for tax legislation are based on a detailed review of the country's international tax arrangements which was published last year.

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