International Tax in the Digital Age

Conservative estimates of the loss of tax revenue in Australia due to multinational entities avoiding paying tax is approximately AU$4.2 billion per year. There is a rapidly diminishing capacity of nations to secure any share of the profits of multinational entities by any tax or other means in the current technological environment. In a post COVID environment, addressing the tax challenges of the digitisation of the economy, ensuring multinational enterprises pay taxes, and developing approaches to meet the need to collect more tax revenues are likely to provide even greater impetus to reach fiscal solutions to international tax avoidance. The project team is generating new knowledge in international tax by developing a blueprint for allocating profits of multinational enterprises between jurisdictions that aligns with profit making activity and reduces international tax avoidance. This will provide the significant benefit of developing a major tool in securing Australia’s revenue base in the digital age.