(April 21, 2015)

On April 19, 2015 a media release was published on the website of the Hon Joe Hockey MP – Treasurer of the Commmonwealth of Australia. In the media release it is announced that the United Kingdom and Australia agree to collaborate on multinational tax.

According to the media release, during the course of the G20 meeting (Washington, April 16-17, 2015) the urgent establishment of a joint working group to further consider and develop initiatives in relation to diverted profits by multinational enterprises was announced by George Osborne (UK) and Joe Hockey (Australia).

The G20 meeting highlighted the issue that, through contrived arrangements, some multinationals are diverting profits to avoid tax in their relevant jurisdictions. The Ministers have resolved, subject to the completion of the UK general election, to establish a senior officials working group that will develop measures to address the diversion of profits by multinational enterprises away from their host countries.

According to the media release the working group will build on the UK’s experience of introducing a Diverted Profits Tax, which came into effect at the beginning of April. The media release also states that this is a global issue that needs to be quickly addressed, and as such the working group will be open to all G20 members.

The media release also states that any working group initiatives will be consistent with the work of the OECD on Base Erosion and Profit Shifting, and other international initiatives such as the Automatic Exchange of Information and Tax Inspectors Without Borders.

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