Sydney. The Australian government on Monday announced a world-leading crackdown on alleged tax avoidance by 30 multinational companies in a move that could force the likes of Apple and Microsoft to restructure their businesses to escape huge penalties.

“These companies are diverting profits earned in Australia away from Australia to no-tax or low-tax jurisdictions,” Treasurer Joe Hockey told reporters in Canberra.

He declined to identify the targets, but said “it’s pretty evident which companies are involved”. Google , Apple  and Microsoft revealed earlier this year they were under review by the Australian Tax Office.

The Australian subsidiaries of these global tech titans have all denied any tax evasion.

Australia and Britain are leading steps by countries to tackle large companies over base erosion and profit shifting methods of avoiding tax ahead of coordinated international efforts by the OECD through the Group of 20 leading economies (G20).

Hockey did not detail the content of the proposed new laws, but said they would not contain a profits diversion tax like the “Google tax” introduced by Britain on April 1.

He also declined to say how much money Australia expected to raise through the new laws, which will come into force on Jan. 1 if they pass parliament. More details will be provided in the federal budget due for release on Tuesday.

Companies could be fined up to 100 percent of the amount of tax deemed to be avoided, he added.

‘Netflix’ tax

Hockey also unveiled a plan to extend the country’s existing goods and services tax (GST) to cover digital products purchased from overseas suppliers.

The so-called “Netflix Tax” would level the playing field between Australian and overseas companies and raise around A$350 million over four years, he said.

“When the GST legislation was originally drafted, it did not anticipate the massive growth in the supply of digital goods like movie downloads, games and e-books from overseas,” he said.

Hockey said the proposed multinational tax legislation was the first in the world and had attracted considerable interest at a G20 meeting in Washington last month.

“There was a lot of interest from other finance ministers who would … perhaps take it to their own countries as well, including China,” he said.

One country watching more warily than most may be the United States, which originally backed the G20 crackdown but has since become concerned about Britain, Australia and other nations lining up against U.S. digital companies as they seek extra revenues to trim budget deficits.

Reuters

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Sydney. Australia’s police force on Monday defended its involvement in tracking an international drug smuggling network that culminated in the execution of two Australians by firing squad in Indonesia last week.

The role of the Australian Federal Police (AFP) has been widely criticized at home, with many arguing the police should have prevented some of the so-called “Bali Nine” from leaving Australia instead of tipping off their Indonesian counterparts.

Police Commissioner Andrew Colvin said investigating officers knew the Australians would be exposed to arrest — and potentially the death penalty, which Australia does not have — when they asked Indonesia to monitor the group.

But Australian police did not have enough evidence to arrest any of the group before they left, he said, adding that police also needed to trace the entire network to break the heroin smuggling ring.

“Decisions like this aren’t taken lightly,” Colvin told reporters in Canberra. “They’re agonising decisions.”

“We can’t apologise for the role we have in trying to stop drug importation,” he added.

Andrew Chan and Myuran Sukumaran, the two Australians named as ringleaders of the Bali Nine, were arrested in 2005 at an airport on the island of Bali for trying to smuggle 8 kilograms of heroin to Australia.

The pair were executed last week, alongside six other drug smugglers from several countries, despite strong international criticism of Indonesia’s use of the death penalty. The other seven men and women who made up the Bali Nine are serving long jail sentences in Indonesia.

The AFP has defended its involvement previously but had stayed quiet in the run-up to the executions last week.

It was revealed on the eve of the executions that police had since made significant changes to insure against similar cases.

Since 2009, a federal minister has been required to sign off before sharing information with foreign agencies that might place Australians at risk of the death penalty, documents released under a freedom of information request showed.

Colvin denied an allegation by lawyer Bob Myers, a family friend of Bali Nine convict Scott Rush, that police promised Rush’s father his son would be stopped from leaving Australia. Lee Rush had contacted police, concerned about his son. Scott Rush had his death sentence commuted to life in 2011.

“If there is to be a message out of these executions that we saw last week … I sincerely hope it is that other young lives are saved by people thinking twice before participating in serious crimes overseas,” said Colvin.

Reuters

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Sydney. Australian Prime Minister Tony Abbott attempted on Thursday to play down allegations of bullying Indonesia as a diplomatic rift deepens between the uneasy neighbors over Jakarta’s planned executions of two Australian drug smugglers.

Australia has been pursuing an eleventh-hour campaign to save Myuran Sukumaran, 33, and Andrew Chan, 31, convicted in 2005 as the ringleaders of the so-called Bali Nine plot to smuggle heroin out of Indonesia.

Abbott drew strong criticism from Jakarta on Wednesday for linking his pleas for clemency for the pair to Australia’s aid to Indonesia after the 2004 Indian Ocean tsunami.

In a harsh rebuke, Indonesian Foreign ministry spokesman Armanatha Nasir warned that “threats are not part of diplomatic language and no one responds well to threats.”

Abbott, under pressure after a recent internal party challenge, said on Thursday he was referring to “the obvious strength of the relationship” between the two countries.

“I was pointing out the depth of the friendship between Australia and Indonesia and the fact that Australia has been there for Indonesia when Indonesia has been in difficulty,” Abbott told reporters in Tasmania state.

Asked if his earlier comments were intended as a threat, Abbott said they were intended as a reminder of that friendship.

On Wednesday, Abbott said Australia would feel “grievously let down” if the executions proceeded despite the roughly A$1 billion in assistance it gave after the 2004 disaster, which killed hundreds of thousands of people in Indonesia’s Aceh province.

Indonesia postponed on Tuesday the transfer of Sukumaran and Chan, and three other death-row inmates, to another prison for execution because of what authorities said were medical concerns and families’ requests for more time with the prisoners.

Abbott and UN Secretary-General Ban Ki-moon have appealed to Indonesia, which resumed capital punishment in 2013 after a five-year gap, not to execute prisoners for drug crimes.

Also facing execution in Indonesia for drug offences are citizens of Brazil, France, Ghana, Indonesia, Nigeria and the Philippines.

Australia and Indonesia have a long history of diplomatic tension, which has periodically complicated cooperation on issues such as people-smuggling.

Indonesia recalled its envoy and froze military and intelligence cooperation in 2013 after reports that Canberra had spied on top Indonesian officials, including former President Susilo Bambang Yudhoyono’s wife.

Full diplomatic cooperation was restored last May but Australia has foreshadowed withdrawing its ambassador fromJakarta if the executions go ahead.

Reuters

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