The agreement is aimed at ensuring multinationals pay their fair share of tax in Australia and abroad.
There were 136 members of the OECD Inclusive Framework on Base Erosion and Profit Shifting (BEPS), representing more than 90 per cent of global GDP, that signed up to the historic agreement. These members also agreed to have the new international tax framework implemented in 2023.
Australia has played a key role in driving these reforms, including by advancing the international tax reform agenda.
Mr Frydenberg said he would discuss a possible start date of 2023 at the upcoming G20 Finance Ministers and Central Bank Governors meeting on 13 October.
“Australia’s ongoing engagement in the OECD-led multilateral process complements the strong action the Government has taken to strengthen the integrity of Australia’s corporate tax system and prevent multinational tax avoidance,” he said in a statement.
“The government has implemented more than a dozen measures to address corporate and multinational tax avoidance, including the Multinational Anti-avoidance Law; the Diverted Profits Tax; increased tax penalties for large entities; and establishing a dedicated Tax Avoidance Taskforce within the ATO.”
The ATO has raised more than $22.9 billion in tax liabilities against large public groups, multinational corporations and privately-owned and wealthy groups as a result of these actions since July 2016.
“The government has extended the GST to imported digital products and services from July 2017 and to low value imported goods from July 2018, and to offshore sellers of hotel bookings in Australia from July 2019. These changes have ensured there is a level playing field with Australian based providers of these goods and services,” Mr Frydenberg said.
