Corporations

- general taxes on corporations; corporate income taxes; dividend imputation; private companies;
  independent contractors

- see also Assets; Capital gains; Environment; International transactions; Trusts

Company Directors Have No Duty To Avoid Tax, Formal Legal Opinion States (media release)
Tax Justice Network (September 2013). 

Tackling Corporate Tax Avoidance in a Global Economy: Is a new approach needed?
House of Lords Select Committee on Economic Affairs (July 2013). 

Risks to the Sustainability of Australia’s Corporate Tax Base Scoping Paper
Australian Government Treasury (July 2013).  Australia collects more corporate tax as a share of GDP than most other OECD countries. In 2011 12, Australia had corporate tax receipts of $66.6 billion, or 4.5 per cent of GDP and 22 per cent of total tax receipts. This means that Australia has a strong interest in monitoring and, where necessary acting on, developments that pose a risk to the sustainability of its corporate tax base. A number of clear risks to the sustainability of the corporate tax regime have begun to emerge over the last decade. The increasing use of strategies to exploit gaps and inconsistencies in tax treaties, the increased 'digitisation' of industries and the challenges for the international community to effectively curb the harmful tax practices of some jurisdictions, have all highlighted shortcomings in the international tax framework. This paper examines those risks. In doing so, with the issue of tax base erosion and profit shifting firmly on the G20 agenda, and with Australia chairing the G20 in 2014, this paper will also help inform the leading role that Australia can and should play in framing multilateral discussions on international tax reform going forward.

Nuts & Bolts of Corporate Tax Reform - Presentation for the Alliance for a Just Society
Steve Wamhoff, Citizens for Tax Justice (July 2013).  The corporate income tax is a progressive source of revenue and the US Congress should increase this revenue by limiting or eliminating breaks that allow large, profitable corporations to avoid taxation. The most important of these are breaks for corporate profits that are generated offshore or claimed to be generated offshore. Lawmakers should also oppose proposals discussed today that would expand these breaks and result in more corporations relying on offshore tax havens.

G8 Summit Fails to Deliver on Tax Reforms (video)
Aljazeera (June 2013). 

Protecting the Corporate Tax Base from Erosion and Loopholes - Removing the tax advantages available to multiple entry consolidated groups (Issues Paper)
Australian Government Treasury (May 2013).  On 14 May 2013 the Deputy Prime Minister and Treasurer announced a package of reforms to protect the corporate tax base from erosion and loopholes. One area of reform relates to the inconsistent tax treatment between multiple entry consolidated (MEC) groups and ordinary consolidated groups. To address this issue, the Government will amend the law to remove the tax advantages available to MEC groups.

Why We Need the Corporate Income Tax
Citizens for Tax Justice (June 2013).  Some observers have asked why we need a corporate income tax in addition to a personal income tax. The argument often made is that corporate profits eventually make their way into the hands of individuals (in the form of stock dividends and capital gains on sales of stock) where they are subject to the personal income tax, so there is no reason to also subject these profits to the corporate income tax. Some even suggest that the $4.8 trillion that the corporate income tax is projected to raise over the next decade could be replaced by simply raising personal income tax rates or enacting some other tax. This is a deceptively simple argument that ignores the massive windfalls that wealthy individuals would receive if there was no corporate income tax.

Apple Is Not Alone
Citizens for Tax Justice (June 2013).  Recent Congressional hearings on the international tax-avoidance strategies pursued by the Apple corporation documented the company's strategy of shifting U.S. profits to offshore tax havens. But Apple is hardly the only major corporation that appears to be engaging in offshore-tax sheltering: seventeen other Fortune 500 corporations disclose information, in their financial reports, that strongly suggests they have paid little or no tax on their offshore holdings.

Submission to Issues Paper on Implications of the Modern Global Economy for the Taxation of Multinational Enterprises
Tax Justice Network Australia (May 2013).  The TJN-Aus agrees with the OECD that tax dodging by multinational companies can "produce unintended and distortive effects on cross-border trade and investments" and that "it distorts competition and investment within each country by disadvantaging domestic players".

Corporate Tax Rates and Economic Growth Since 1947
Thomas L. Hungerford, Economic Policy Institute (June 2013).  Cutting corporate taxes will do nothing to spur economic growth, according to a new paper from EPI Director of Budget Research Tom Hungerford. In Corporate Tax Rates and Economic Growth Since 1947, Hungerford find no evidence that high corporate taxes have a negative impact on the economy. In fact, there is no correlation at all between corporate tax rates and economic growth.

Implications of the Modern Global Economy for the Taxation of Multinational Enterprises Issues Paper
Australian Government Treasury (May 2013).  There is growing concern – in Australia and globally – that many of the key rules of international taxation may not have kept pace with the evolution of the global economy. International tax reform is increasingly on the agenda of G20 Finance Ministers and Leaders. Last year the Government asked the Treasury to develop a Scoping Paper to examine the risks to the sustainability of Australia's corporate tax base from the way current international tax rules are able to be used to minimise or escape taxation. This analysis is being informed by a specialist reference group, made up of business representatives, tax professionals, academics and the community sector. The purpose of this Issues Paper is to seek views of stakeholders and the community more broadly to ensure the analysis in the Scoping paper captures and addresses the key issues. The Issues Paper outlines the challenges that changes in the global economy pose to the international tax system.

Submission on Improving the Transparency of Australia's Business Tax System
Tax Justice Network Australia (April 2013). 

The case against cutting the corporate tax rate
David Richardson, The Australia Institute (December 2012).  It is often argued that reductions in the corporate tax rate are necessary to create employment, increase investment and deliver a range of other benefits to the Australian community. However, despite the widespread support for this view, particularly among the business community, the theoretical and empirical case for such an expensive change in policy is weak. This paper is structured as answers to a series of questions about the design and impact of the taxation of corporate income in Australia however it begins with a brief historical overview of the tax treatment of profits in Australia.

Executive-Pay Tax Break Saved Fortune 500 Corporations $27 Billion Over the Past Three Years
Citizens for Tax Justice (April 2013).  Earlier this year, Citizens for Tax Justice reported that Facebook Inc. had used a single tax break, for executive stock options, to avoid paying even a dime of federal and state income taxes in 2012. Since then, CTJ has investigated the extent to which other large companies are using the same tax break. This short report presents data for 280 Fortune 500 corporations that, like Facebook, disclose a portion of the tax benefits they receive from this tax break.

Ten (of Many) Reasons Why We Need Corporate Tax Reform: Companies From Various Sectors Use Legal Tax Dodges to Avoid Taxes
Citizens for Tax Justice (April 2013).  This CTJ report illustrates how profitable Fortune 500 companies in a range of sectors of the U.S. economy have been remarkably successful in manipulating the tax system to avoid paying even a dime of tax on billions of dollars in profits. These ten corporations’ tax situations shed light on the widespread nature of corporate tax avoidance. As a group, the ten companies paid no federal income tax on $16 billion in profits in 2012, and they paid zero federal income tax on $57 billion in profits over the past five years. All but one paid less than zero federalincome tax in 2012; all paid exceedingly low rates over five years.

Tax Activists and the Global Movement for Development through Transparency
Allison Christians (2012).  Activists around the world seek to expose a global system that fails to tax multinationals adequately and thus deprives governments of needed revenues, with profound effects for development in the world’s poorest nations. These tax activists have sparked a global movement, with groups all over the world seeking progress for development in poor countries by demanding greater transparency about how and how much multinational companies pay taxes.

Towards Unitary Taxation of Transnational Corporations
Sol Picciotto, Tax Justice Network (9 December 2012).  It has become clear that we need to take a fresh look at how transnational corporations (TNCs) are taxed. This paper, building on long experience and analysis of the actual practice of tax administrations around the world, proposes a thorough reform of the system towards a fresh approach: Unitary Taxation. This would help place the international tax system on a foundation fit for the 21st century.

Addressing Base Erosion and Profit Shifting
OECD (February 2013) .  The project, quickly known as BEPS (Base Erosion and Profit Shifting) is looking at whether, and if so why, the current rules allow for the allocation of taxable profits to locations different from those where the actual business activity takes place. The aim is to provide comprehensive, balanced and effective strategies for countries concerned with base erosion and profit shifting.

Final Report
Business Tax Working Group (November 2012).  The Business Tax Working Group (Working Group) was established following the Tax Forum in October 2011. The terms of reference ask the Working Group to make recommendations on how the business tax system could be improved to make the most of the challenges and opportunities arising from transformations in the broader economy, including the patchwork economy, and that aim to increase productivity while delivering relief to struggling businesses.

Business Tax Working Group Discussion Paper
The Parliament of the Commonwealth of Australia. 

Business Tax Working Group consultation guide
The Treasury (2012).  The purpose of this consultation guide is to provide stakeholders with an understanding of how the Working Group plans to involve the community in its consideration of business tax reform. This consultation guide sets out the principles that the Working Group will use to guide its thinking about the merits of particular base broadening options that could accompany a cut to the company tax rate.

Preparing for a Better Future
Business Council of Australia (October 2011).  The Business Council of Australia puts forward its proposals for changes to the tax system, including changes to the personal and company tax systems.

A Race to the Bottom: Globalisation and Company Tax
ACTU (September 2011).  This paper looks at the case that despite globalisation, the case for taxing corporations remains strong.

Catholic Social Services Australia Statement of Reform Priorities
Bishop Pat Power (September 2011).  Catholic Social Services Australia's statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.

Associate Professor Miranda Stewart Statement of Reform Priorities
Miranda Stewart (September 2011).  Miranda Stewart's statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.

Community and Public Sector Union Statement of Reform Priorities
Nadine Flood (September 2011).  Community and Public Sector Union's statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.

Australian Council of Trade Unions Statement of Reform Priorities
Jeff Lawrence (September 2011).  Australian Council of Trade Unions' statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.

Australian Council of Social Services Statement of Reform Priorities
Dr Cassandra Goldie and Peter Davidson (September 2011).  Australian Council of Social Services statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.

Per Capita Tax Survey for 2011: Public Attitudes towards Taxation and Government Expenditure
David Hetherington (September 2011).  The Per Capita Tax Survey for 2011 has asked 1,300 Australians for their views on personal tax contributions, overall taxation levels, public service spending and new tax proposals such as the Minerals Resource Rent Tax and the carbon tax.

Mining the truth: The rhetoric and reality of the commodities boom
David Richardson and Dr Richard Denniss (8 September, 2011).  This paper seeks to describe the various ways in which the mining boom is changing the Australian economy. In particular, it highlights some of the negative consequences of the boom which are rarely acknowledged in public discussion of economic issues.

New Protectionism Under Carbon Pricing: Case Studies of LNG, Coal Mining and Steel Sectors
Tony Wood and Tristan Edis (6 September 2011).  The Government's unduly generous assistance to industry under its carbon emissions package may create a new protectionism. The whole community will pay for unjustified subsidies to the LNG and coal industries.

IMF Working Paper - Taxing Financial Transactions: An Assessment of Administrative Feasibility
John D. Brondolo - IMF (1 August 2011).  The IMF's fiscal affairs department has posted a working paper titled "Taxing Financial Transactions: An Assessment of Administrative Feasibility", which examines the practical issues countries should deal with in the introduction and application of a financial transactions tax (FTT).

National Tax Forum discussion paper
Australian Government (28 July 2011).  Discussion paper released by the Australian Government in the leadup to the National Tax Forum in October 2011, particularly dealing with the six sessions to be included at the forum: Personal tax, transfer payments, business tax, state taxes, environmental and social taxes, and tax system governance.

Taxation trends in the European Union
Eurostat (1 July 2011).  An overview of taxation in the European Union, by type of tax (consumption, labour income, company income and capital income), by level of government (federal, state, local), and by country.

Top Total Income Tax Rate on US Corporate Profits, 1913-2011
Jim Nunns, Tax Policy Centre (7 Jun 2011).  A report exploring the total income tax rates on corporate profits in the US, which takes account of the corporate rate and the individual rates on dividends and capital gains, as well as on the share of after-tax profits corporations pay as dividends, the share of stock held in retirement and other nontaxable accounts, and the timing of capital gains realizations.

OECD Tax Agenda 2011 - multinationals
OECD (12 Apr 2011).  An excerpt from the OECD's latest Tax Agenda brochure, outlining its current work in a variety of tax-related areas, including: Taxation of Multinational Enterprises.

Understanding the economic contribution of business
PriceWaterhouseCoopers (11 Apr 2011).  The 2010 edition of PwC's 'Total Tax Contributions' report. The study reveals structural problems with Australia’s tax system and the burden it imposes on Australian business in terms of both compliance and administration costs.

Analysis of the proposed reduction in company tax rates
Naomi Edwards, The Greens (Mar 2011).  A research brief on the proposed reduction in company tax rates in Australia, prepared for Australian Greens Leader Senator Bob Brown's address to the Australian Council of Social Services (ACOSS) National Conference.

Cutting Tax Preferences Is Key to Tax Reform and Deficit Reduction
Donald Marron, Tax Policy Centre (Feb 2011).  Donald Marron's testimony before the Senate Committee on the Budget on reforming the tax code by cutting tax preferences. His testimony includes: how tax preferences pervade the US tax code, how the first step in any income tax reform should be to broaden the tax base by reducing or eliminating tax preferences and how policymakers can then use the resulting revenue to lower tax rates, reduce future deficits, or both.

Paying Taxes 2011: The global picture
World Bank, the International Finance Corporation and PwC (Nov 2010).  The latest in an annual study measuring the ease of paying taxes across 183 economies worldwide, covering both the cost of taxes and the administrative burden of tax compliance. It finds that businesses in Australia pay an average of 25.9 cents of every dollar of profit in tax, compared with a global average of 18 percent.

Consultation Paper: Reform of the Controlled Foreign Company Rules
Australian Commonwealth Treasury (Jan 2010).  Consultation paper prepared by Treasury regarding the reform and modernisation of the controlled foreign company (CFC) rules.

Progressive Tax Reform: Reform of the Personal Income Tax System
Australian Council of Social Service (November 2009).  This report advocates strengthening the personal income tax system in order to achieve progressive tax reform. It covers topics such as personal income tax rates, consumption taxes, company income taxes, taxation and saving, taxation and the transfer system.

Perspectives on Company Tax
Ken Henry, Secretary to the Commonwealth Treasury (21 August 2009).  Speech to the Australia New Zealand Leadership Forum.

Tax Reform - Future Direction
David Parker, Executive Director - Revenue Group of the Treasury (17 September 2009).  Speech to the Minerals Council of Australia's Biennial Tax Conference on reforms generally, and the link between resource taxation and company tax.

'The Missing Billions: The UK Tax Gap
Trade Union Congress (29 February 2008).  A report that calculates the tax lost to the UK Government from tax avoidance and from tax planning by the very wealthy.