Mr Hockey was immediately criticised by the opposition for not being able to put a specific figure on how much the measure will raise and tax experts warned that it could spark "retaliatory" laws by other governments to targetting Australian companies. Rumour has it that Joe Hockey is to be slain as treasurer and his remains deported from the gallows to the Communications portfolio. Credit:Alex Ellinghausen The Tax Office embedded staff in the offices of 30 high-risk multinationals to learn more about their tax structures but Mr Hockey said on Wednesday that the new law would cover 1000 companies with global revenues above $1 billion. He said a number of multinationals have already come forward and are, he said, "prepared to restructure their businesses to pay their fair share of tax". "With the introduction of this legislation, we are sending a clear message that Australia has no tolerance for tax avoiders. If you are avoiding tax, the Australian Taxation Office will catch you," Mr Hockey said.

Tax Commissioner Chris Jordan said the ATO's task would be to understand the actual profits companies make in Australia but "backed out" of the country. A Senate inquiry into tax avoidance has heard evidence that multinational tech companies such as Apple, Google and Microsoft make huge sales in Australia but report tiny taxable profit margins. Likewise, pharmaceutical companies are under pressure over their low profitability in high tax markets such as Australia. The new rules appear to also apply to large Australian-owned multinationals such as BHP Billiton and Rio Tinto, which have been criticised for booking profits in low-tax jurisdictions such as Singapore where they have established "marketing hubs". Mr Jordan said: "We have to … have a much better understanding of [companies'] true cost of sales not some inflated cost of sales. "We know there are billions of dollars of sales of revenue that is not being booked in Australia," he said.

Mr Hockey said he had deliberately not put a number on how much revenue would be raised but shadow assistant treasurer Andrew Leigh said Labor would have been "laughed out of Parliament" if it had fronted up with an uncosted plan. "When the Treasurer can't even put a dollar figure on what his plan is worth you have to ask if he is serious about protecting Australia's revenue base," Mr Leigh said. "This is the same Treasurer who is currently trying to gut Australia's transparency laws to help big companies keep secret how much tax they really pay." Labor's first policy released in opposition promised to net $7.2 billion in a crackdown on companies using debt and tax deductions to shift profits out of the country. The ATO, which has been dealing with steep budget cuts and mass redundancies, has been given an extra $87 million to increase the focus on multinational tax avoidance.

The new law, which will take effect from January 1 next year, also brings into force country‑by-country reporting rules developed by the Organisation for Economic Co-operation and Development (OECD). Follow us on Twitter