Revised country by country draft legislation

Australia is another step closer to mandatory public disclosures of country-by-country tax information for multinational groups.

Australia is another step closer to mandatory public disclosures of CBC tax information.

The Australian Government on 12 February 2024 announced in a media statement the release of exposure draft legislation (ED) and explanatory materials (EM) that propose amendments to the Taxation Administration Act 1953 (TAA) to implement the public country-by-country (CbC) reporting proposals for reporting periods that start on or after 1 July 2024.

Australia’s new tax transparency measures will significantly enhance the tax information that multinational groups will need to disclose to the public – affecting not only Australian headquartered multinational (MNE) groups but also foreign owned multinational groups with Australian operations over a certain size. Australia’s proposals broadly draw on the narrative and quantitative reporting aspects of Global Reporting Initiatives’ (GRI) Sustainability Reporting Standards and the OECD CbC reporting guidance.

The proposals were foreshadowed in the October 2022-23 Federal Budget on 25 October 2022 and builds on an earlier exposure draft (April 2023 ED). Following consultation with stakeholders, on 23 June 2023 the Government announced a delay in the start date of the measures and a narrowing of the data requirements to be disclosed.

Stakeholder feedback

Importantly, this latest draft takes into consideration stakeholder feedback from the April 2023 ED on three important matters:

the removal of Australian specific data requirements set out in the April ED (such as details of intangibles, lists of tangible assets and Pillar Two effective tax rates), ensuring the information requirements for disclosure are now more closely aligned to the private OECD CbC reporting requirements, GRI 207-1 and GRI 207-4
required data can now be aggregated for all foreign jurisdictions that are not on a list of 41 specified jurisdictions – see Exposure draft – Taxation Administration (Country by Country Reporting Jurisdictions) Determination 2024 (PDF) . This list is closely aligned to the International Dealings Schedule specified jurisdictions list excluding those in the European Union
a de minimis threshold applies to MNE groups such that a CbC reporting parent is not subject to a reporting obligation if less than A$10 million of the group’s global income for the income year is Australian sourced income.

Read our full analysis of the draft legislation.