Singapore, Ireland top havens for multinational tax dodgers

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http://www.smh.com.au/business/singapore-ireland-top-havens-for-multinational-tax-dodgers-20140430-37hzi.html

Australian companies sent almost $60 billion to related parties in tax havens in 2012, with payments to Singapore and Ireland featuring high on the list, according to new data.

The data, never before released by the Australian Tax Office, provides an insight into how multinational groups shuffle money between countries and comes amid an international push to halt the use of tax havens by major corporations.

Due to their low tax rates, Singapore and Ireland are used by multinationals, especially technology companies such as Google and Apple, as locations for sales hubs or corporate headquarters.

In 2012 almost $40 billion was sent to Singapore, which led the payments table despite being only Australia's fourth-largest import market that year, according to Department of Foreign Affairs and Trade data.

At more than $7.5 billion, Ireland, which ranks 32nd among Australia's trading partners, was sixth on the payments table.

The ATO data shows that Australia was also on the receiving end of flows from tax havens. Switzerland was the top source of revenue for Australian companies, at $35.6 billion in revenue, and Singapore came second at $12.3 billion.

However, a BusinessDay analysis of the ATO data shows Australian companies paid $1.22 billion more to 26 tax havens, including Singapore, Ireland and Luxembourg, than they received from the same countries.

Almost $60 billion was paid to the 26 havens, which also take in jurisdictions in the Channel Islands and the Caribbean, against about $57.8 million received.

The new data may understate the flows because the ATO only asks for each company's biggest trades and does not require reports from companies with less than $2 million in overseas related party dealings.

Companies have had to provide the information since the end of 2012 as the ATO stepped up scrutiny of international tax risks.