The financial workings of corporations such as Apple and Google could soon face greater scrutiny in Australia thanks to a new parliamentary inquiry into tax avoidance by multinational companies.

The upper house of the Australian parliament yesterday voted to refer the matter to the Parliament's Economics References Committee for inquiry, in order to address "tax avoidance and aggressive minimisation by corporations registered in Australia and multinational corporations operating in Australia". The Committee is due to report back in June 2015.

The issue was raised by Senator Christine Milne following revelations in the 'Who Pays for our Common Wealth?' report that, of Australia's largest 200 companies, 14 percent have an effective tax rate of 0 percent. In addition, the report found that a further 29 percent of these companies have an effective tax rate of 10 percent, significantly less than the Australian company tax rate of 30 percent.

Senator Milne argued that "the Government could raise billions in revenue if companies paid the full 30 percent tax rate".

The Australian Taxation Office has the profit-shifting practices of major international companies in its sights, launching a two-year plan in 2013 to encourage the Government to crack down on companies shirking their responsibilities.

In a speech last month, ATO International Deputy Commissioner Mark Konza said it was vital "to ensure that companies pay tax in the country where the real economic activity occurs and where the profit is earned".

Big name tech companies such as Apple and Google are often caught up in the tax debate, with Google executive chairman Eric Schmidt forced to leap to the defence of his company last year after its tax practices in the UK were labelled by British MP Margaret Hodge. Apple has also come under fire for basing its international operations in Ireland, which has a relatively low corporate tax rate of 12.5 percent.

According to Sydney University senior lecturer on taxation Antony Ting, Apple is not just famous for innovative products, but it has also "proved to be equally creative in its tax structure".

In a report on Apple's International Tax Structure, published in March this year, Ting said Apple had "successfully sheltered $44 billion from taxation anywhere in the world" from 2009 to 2012. In addition, Ting said that detailed information about Apple's tax structure was "difficult, if not impossible, to discern from its financial statements".

An investigation published by the Australian Financial Review in March of this year found that "while Australians have bought $27 billion worth of Apple products since 2002, the company has paid only $193 million to the...ATO -- just 0.7 percent of its turnover".

Speaking to the AFR, Ting put the issue in real-world terms:

"If I pay $600 for an iPad in Australia, then $550 is paid to Apple Ireland and out of the $550, $220 is not taxed anywhere in the world," he said.