Businesses fear 'name and shame' over tax

Aggressive tax avoiders would be named and shamed under a proposed policy. Photo / File

Concern over the amount of tax paid by multinational companies has the government mulling a tax transparency register which would name and shame aggressive tax avoiders, a tax expert at EY says.

Such a policy is currently in force in Australia and was part of a package, including a clampdown on diverted profits popularly known as a "Google tax", following an outcry across the Tasman over tax avoidance by large companies.

Tori Sullivan, a director of professional services firm EY, told the Herald she was unsure of how far along the proposal was from being implemented but claimed Revenue Minister Michael Woodhouse had suggested the measure was under consideration in a speech earlier this month.

Sullivan said while much of the information that would go on such a register - in Australia it included revenue, net profits and tax paid - was already public she was in two minds over the proposal as it risked eroding the longstanding principle of tax secrecy.

"In Australia's there's a similar thing that has the ATO naming and shaming taxpayers," she said.

Woodhouse, through a spokeswoman, damped down suggestions any such move was imminent.

""The Government is interested in Australia's earlier discussion around a voluntary 'tax transparency code'. There are however no plans for Inland Revenue to follow suit with the Australian Tax Office and publish the tax information of large companies operating in New Zealand," he said.

In an opinion piece for Interest.co.nz, Sullivan further outlined her concerns that the complexities of international taxation were being overlooked.

"The IRD should be cautious before taking the drastic step of forcing public disclosure on a small group of high-profile taxpayers. Once named, careful explanations by taxpayers that they have fully complied with all existing tax laws, or how exactly a "fair share" should be calculated, are often overlooked," she said.

Earlier this month Woodhouse made veiled criticism multinational companies by describing their "deafening silence" in response to public concerns.

His spokeswoman told the Herald this afternoon he supported OECD calls for companies to "be more transparent about the tax they pay".