Report on Interest

Australia, Google settle $859m tax dispute

By News Desk

Alphabet Inc’s Google has settled a “longstanding” tax dispute with Australia’s tax office after paying an extra $326.75 million on its previous tax bill.

The settlement comes after an audit that looked into the tech giant’s tax practices between 2008 and 2018, a Google spokeswoman said.

In a separate statement on Wednesday, the Australian Taxation Office (ATO) said it has now netted A$1.25 billion ($859 million) after settling tax disputes recently with other tech giants such as Microsoft, Apple and Facebook under the Multinational Anti-Avoidance Law (MAAL).

“Thanks to the efforts of our ATO officers under the Tax Avoidance Taskforce and the introduction of the MAAL, Australian sourced sales by these digital giants will now be returned to Australia’s tax base,” the ATO said in a statement, calling the settlement “another e-commerce victory.”

Facebook, Google, Amazon and other large technology companies have faced criticism globally for reducing their tax bills by booking profits in low-tax countries regardless of the location of the end customer. Such practices are frowned upon by many countries as unfair.

A Google spokeswoman said the settlement with the ATO will provide certainty for future tax treatment.

Australian Treasurer Josh Frydenberg said in a statement the establishment of the tax avoidance taskforce in 2016 has helped strengthen tax compliance of multinationals and large corporations.

“Ensuring large companies and multinationals pay the right amount of tax means we can continue to deliver the essential services Australians rely on,” Frydenberg said.

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