21 Jun 2013

Multinational tax avoidance not easy to fix says tax expert

7:05 pm on 21 June 2013

A British tax expert says New Zealand can take steps to ensure multinational firms pay their fair share of tax in this country, but the issue won't be easily fixed.

Association of Chartered Certified Accountants head of taxation Chas Roy-Chowdhury is in New Zealand to talk about key tax issues with business leaders.

Mr Roy-Chowdhury is in regular contact with the European Commission and the UK's Treasury and tax departments on tax matters including multinational companies paying little or no corporate tax.

He says issues such as shifting profits from one country to another will take years to fix.

Mr Roy-Chowdhury says the United States will have to give up some of their taxing rights and reform their corporation tax system which is a very big ask.

He says there is a great global will to fix tax invasion which should be able to be fixed more quickly.

Mr Roy-Chowdhury says tax evasion and avoidance of multinational companies is widely misunderstood and multinationals are unfairly targeted.

He says it's necessary to look at the overall tax take which includes GST payments, social security payments and tax and income that businesses are paying and the employment companies are generating.

Mr Roy-Chowdhury says multinationals overall contribution to the economy needs to be looked at rather than just focusing on one narrow area.