Michael Andrew is finalising his recommendations to the federal government on strategies to combat the black economy. Credit:Louise Kennerley It suggests that businesses with turnover of between $100 million and $500 million be required to give only general tax details and/or commentary on their tax position. As a raft of submissions to the board have made clear: it is a chance for a large business to "tell its own tax story". A government-mandated PR exercise. Multinationals, under international pressure to pay more taxes, will now publish reports explaining how they are genuinely good taxpayers who pay their "fair share". Hang on, isn't that what they already do via their spin doctors? As groups including the Tax Justice Network and Washington-based FACT Coalition have argued, the best way to provide real transparency of US companies' international operations, would be to require companies to publicly disclose country-by-country financial data.

A report has found that most of America's largest corporations, including Google, Citigroup, Nike, Pfizer, and PepsiCo, maintain subsidiaries in "tax havens". Credit:Tamara Voninski This information, which tax revenue authorities will privately collect, would reveal the dollar amount of international related party dealings. It would give a country-by-country basis picture of corporate revenue, profits, taxes paid, assets and employees. It would provide greater insight into secrecy jurisdictions (the OECD has decided to stop labelling places like Cayman Islands and Bermuda as tax havens) multinationals use. Then treasurer Joe Hockey addresses the media during a doorstop interview regarding multinational tax, at Parliament House in Canberra in December 2014. Credit:Alex Ellinghausen But under Australia's proposed code, there will be no detailed disclosure. Why? The reason isn't that multinationals have nothing to hide.

In fact, the board admits that: "Foreign multinational businesses can in some instances sell goods or services to Australian customers without being subject to Australian income tax". Multinational tax evasion by US companies is estimated to cost $US2.5 trillion. Credit:Kerrie Leishman At least 367 companies or 73 per cent of the Fortune 500, operate in one or more tax haven countries. The board's reasoning not to disclose is that it "considers the disclosure of this information, apart from raising issues of commercial sensitivity, may not be meaningful to the intended users". And that "while there may be a public interest in the tax payments of these entities, the board does not consider that this interest would be served by requiring foreign multinationals to disclose sales to Australian customers".

Instead of feeding taxpayers the business lobby line, the government and board would be better to let the public decide whether or not they think it's useful. So far there are 18 submissions published on the board's website, and naturally all the big four accounting firms and business lobbies follow the same script: Good on you Board of Tax for taking our side in the transparency debate. Apart from a submission from Australian Catholic University lecturer Dr Rachel Tooma suggesting that the ATO gives the most transparent company an award entitled "corporate taxpayer of the year for disclosure", the only dissenting voice is the Tax Justice Network. The Tax Justice Network rightly states that "the board's recommendations are so flawed that the code should be abandoned as it will serve no useful purpose" and that "businesses will continue to be subject to public pressure to explain their tax affairs". It also adds that there's no ability to verify information in the reports, let alone penalties for companies giving false or misleading reports.