Australia

Google and Facebook now paying full tax, Australia says

Australian Treasurer Scott Morrison delivers the 2016 Federal Government's budget in the House of Representatives in Canberra, Australia, May 3, 2016. Image copyright Reuters
Image caption Australian Treasurer Scott Morrison said the country's tax office now had the power and resources it needed

Multinational firms such as Google and Facebook are now paying tax in Australia based on profits earned there instead of shifting income abroad, the government has said.

Changes to the tax system will raise an extra 2bn Australian dollars ($1.5bn; £1.2bn) in this tax year, it said.

A new law targets global companies with annual incomes of more than A$1bn.

Firms were told if they did not pay what was due they would be taxed at a penalty rate of 40%.

Australian Treasurer Scott Morrison said the government had given the Australian Taxation Office "the power, the resources and the penalties to get the job done".

He said that Australian tax authorities were currently conducting 71 audits involving 59 major global corporations.

When the Multinational Anti-Avoidance Law was proposed in early 2015, the government said there were 30 global corporations that paid little or no tax on the profits from their Australian operations.

The Australian Tax Office was given a 1,000-person strong team of tax avoidance specialists to focus on large companies and wealthy individuals avoiding tax.

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