The Greens are calling on the Australian financial services watchdog to audit foreign-owned companies like Facebook that avoid scrutiny via a tax loophole.



Facebook Australia has not lodged annual accounts since 2009 because it says that under so-called financial relief orders smaller enterprises are exempt from having to file reports. This is despite the operation being part of one of the world’s most highly valued companies.

The Australian Securities and Investments Commission (Asic) was not able to say, when pushed in a Senate estimates committee, whether or not it had audited Facebook Australia for these financial relief orders.

“This is an issue with relation to tax evasion,” the Greens leader, Christine Milne, said.

“Just because you don’t lodge financial reports that are audited does not mean you are avoiding tax,” Asic’s John Price replied. “They are completely different things.”

Around 1,134 foreign-owned companies have applied for financial relief through Asic, claiming their business undertakings in Australia make them small operations.

“Asic makes a lot of financial relief orders,” Price said. “That [legislation] has been in place since 1998.”

Facebook recorded revenue of almost $US8bn in 2013, and has come under fire for basing its European headquarters in Ireland in order to pay only a low rate of tax. Requests for comment from Facebook Australia went unanswered.

The Coalition has pledged to crack down on tax evasion. “The government is fully committed to tackling any base erosion and profit shifting and to make sure all companies pay their fair share of tax on profits generated in Australia,” the acting treasurer, Mathias Cormann, said.

The Nationals senator John Williams wants a royal commission into white collar crime, claiming Australia is “a paradise” for such offences.