Which companies are you talking about? Companies like Chevron that tried to minimise their tax by overcharging parent company borrowing costs have been taken to court by the ATO and have lost. Many companies have got away with various schemes in the past due to tax office and politician ignorance and inexperience. Those days have gone and current legislation enables Australia to get its share of tax revenue, assuming they know how to audit these companies. Some companies had massive developments involving anything from 30 to 70 billion dollars. They write this off against their taxable income over various periods depending on classifications of infrastructure or other capitalised expenditure. Maybe the average is ten years, which could amount to 5 Billion a year write off. The same rule applies whether you are a battler in the burbs with an investment property or the likes of Twiggy Forrest’s company .
Finally, companies worldwide will seek to minimise tax. The extent to how much they minimise it is totally dependent on the taxation regulations of their host country, which in turn is ultimately dependent on the politicians of that country. Ours have let us down badly.
Bear in mind though that if a country raises its taxes for whatever reason , or it doesn’t reduce them to be more competitive, money is fluid and will move to other locations. This ends up being a great cost to countries that are not tax competitive, as I suspect we will learn over the next five years.
