New levy on digital giants sways crossbench on tax cuts

May 21, 2018

A new tax on digital giants including Google, Facebook and Uber has won support from crucial Senate crossbenchers, clearing the way for a possible vote within weeks on two Turnbull government flagship economic policies worth $175 billion.

Australian Conservatives leader Cory Bernardi says it’s important that the government address the way these digital giants creatively avoid paying tax in Australia.

The Sydney Morning Herald reports Treasurer Scott Morrison has confirmed a tax targeting some of the world's largest and most popular companies is now inevitable, with Labor providing in-principle support for a crackdown on digital companies.

Google Australia last year reported revenue of $1 billion, including $604 million from advertising.

It paid $37 million in tax on a total profit of $125 million.

Facebook's Australian revenue increased to $476.8 million in 2016, but the social media powerhouse reported a loss of $9.6 million after settling a $31.6 million debt for previous years with the ATO.

Mr Morrison, who accused digital and social media companies of "ripping out a big part of our tax base" after a meeting with Google and Amazon in Silicon Valley earlier this year,  is growing frustrated at global delays on the issue and is now prepared to go it alone.

Senator Bernardi has told Ashleigh Gillon on Sky News while he doesn’t usually support tax increases, it’s clear the big digital companies are ripping off the Australian taxation system and this needs to be urgently addressed.

To read Erik Bagshaw’s full article, click here.

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