I challenged Revenue Minister Michael Woodhouse in the House yesterday on his complacency over frightening levels of tax avoidance by multinational corporations — estimated to be up to $1 billion per year.
Woodhouse considered both New Zealand Herald investigative journalist Matt Nippert’s figure of $500 million and tax expert Professor Craig Elliffe’s estimate of $1 billion in lost taxes as “speculative” but failed to give any figures of his own. The Minister either doesn’t know or he isn’t asking.
Craig Elliffe’s $1 billion tax avoidance figure is based on OECD experience. $1 billion extra tax dollars per year buys a lot of extra public services. Alternatively, $1 billion extra tax dollars is a lot of additional tax we all have to pay because the likes of Google, Apple, ExxonMobil are not paying their fair share.
Michael Woodhouse’s complacency over tax avoidance is concerning. Chasing after $1 billion of lost tax revenue should be his number one priority as Revenue Minister.
Minister Woodhouse believes “we have a really good tax policy framework” even though massive tax avoidance is going on all around him at the same time.
I did secure one concession from him towards the end: “I am getting some advice about [laws that have been passed in both the UK and Australia to address tax abuse by multinationals], but I am satisfied in the interim that we already have those sorts of rules in the Income Tax Act.”
P.S Find out how little tax multi nationals pay compared to you here.