Australia 'must act' on tax evasion
Research by the Tax Justice Network shows the two Asian jurisdictions remain prime havens for tax evaders and launderers, offering secretive offshore markets that hinder global efforts to stamp out illicit money shifting.
It also highlights several shortcomings in Australia's efforts to improve the transparency of its own financial systems.
The research comes as Treasurer Joe Hockey looks to dump a suite of tax measures announced by Labor, including plans to fight multinational profit shifting.
The Tax Justice Network's financial secrecy index, released every two years, rates countries based on criteria in relation to their ability to promote financial transparency.
The latest index rates Australia 47 out of 100, meaning it must still make "major progress" in offering satisfactory financial transparency.
The report said Australia must take action on several fronts, including banking secrecy and country-by-country reporting requirements.
The network rated Switzerland as the No.1 secrecy jurisdiction in the world. It said Hong Kong and Singapore had crept higher on the index because of their rapid expansion and the displacement of some European and North American offshore activity to Asia.
Mark Zirnsak of the Tax Justice Network in Australia said the increased role of Singapore and Hong Kong in global secrecy was a concern to Australia given the presence of Australian company subsidiaries.
"The ATO has already identified over 100 Australians involved in suspected tax evasion of tens of millions of dollars through the use of 'shell companies' and 'trusts', largely through secrecy jurisdictions," he said.
The report comes as accounting firm Deloitte is accused of advising companies on how to avoid paying tax in some of the world's poorest countries.
But a Deloitte Australia spokesman said the company helped clients "meet their compliance obligations" under international tax laws.
Frequently Asked Questions about this Article…
Australia is lagging in efforts to curb tax evasion due to shortcomings in improving the transparency of its financial systems. The country needs to make major progress in areas like banking secrecy and country-by-country reporting requirements.
Australia is lagging in efforts to curb tax evasion due to shortcomings in improving the transparency of its financial systems. The Tax Justice Network's financial secrecy index rates Australia 47 out of 100, indicating a need for major progress in financial transparency.
Hong Kong and Singapore are becoming more secretive financial centers, offering offshore markets that hinder global efforts to combat tax evasion and money laundering. Their rapid expansion has made them prime havens for tax evaders.
Hong Kong and Singapore contribute to global tax evasion by offering secretive offshore markets that hinder global efforts to combat illicit money shifting. Their rapid expansion has increased their role in global financial secrecy.
The Tax Justice Network's financial secrecy index is a report released every two years that rates countries based on their ability to promote financial transparency. It highlights jurisdictions that are considered secrecy havens.
The Tax Justice Network suggests that Australia take action on several fronts, including addressing banking secrecy and implementing country-by-country reporting requirements to improve financial transparency.
The report suggests that Australia should take action on several fronts, including addressing banking secrecy and implementing country-by-country reporting requirements to improve financial transparency.
The Tax Justice Network's financial secrecy index rates countries based on their ability to promote financial transparency. It highlights areas where countries need to improve to combat tax evasion and money laundering effectively.
The presence of Australian company subsidiaries in Hong Kong and Singapore is concerning because these jurisdictions are becoming more secretive, which could facilitate tax evasion involving Australian entities.
The increased role of Singapore and Hong Kong in global secrecy is a concern for Australia because of the presence of Australian company subsidiaries in these jurisdictions, which could facilitate tax evasion and money laundering.
The ATO has identified over 100 Australians involved in suspected tax evasion through the use of shell companies and trusts, primarily in secrecy jurisdictions, highlighting its role in combating tax evasion.
The Australian Taxation Office (ATO) has identified over 100 Australians involved in suspected tax evasion through the use of 'shell companies' and 'trusts' in secrecy jurisdictions, highlighting ongoing efforts to address these issues.
Deloitte has been accused of advising companies on how to avoid paying taxes in some of the world's poorest countries. However, Deloitte Australia claims it helps clients meet their compliance obligations under international tax laws.
Deloitte has been accused of advising companies on how to avoid paying tax in some of the world's poorest countries. However, Deloitte Australia states that they help clients meet their compliance obligations under international tax laws.
Financial transparency is crucial for everyday investors as it ensures a fair and level playing field, reducing the risk of tax evasion and money laundering that can distort markets and affect investment returns.
'Shell companies' and 'trusts' are often used in secrecy jurisdictions to facilitate tax evasion by obscuring the true ownership and movement of funds, making it difficult for authorities to track and tax these financial activities.
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