Tax Dodgers !

There is n doubt that the big four banks in Australia have acted badly in exploiting their combined banking monopoly to amass huge profits.  Bad publicity more than law changes have ended the practice of issuing fifty dollar fines for paying credit card debts just a day late but this coming Royal Commission is going to be a battle between the government and a phalanx of the worlds best lawyers hired by the banks to protect their profits.

A lot of unpleasant things are going to get dragged - kicking and screaming - into the spotlight and there is an expectation that the findings may result in a more ethical standard of banking practice in this country.  Even the banks seem to have recognised that some sort of enquiry was inevitable and ceased voicing opposition.

Waiting in the wings is another huge problem that is crippling the world economy.  The ability of giant corporations to legally balance their books in such a way that they avoid paying tax on their profits.  There are accusations that oil giant ExxonMobil has paid no Australian tax in the past two years on the $18 billion money flow that is associated with their control of our natural gas industry. This is the firm that runs the critical Esso Longford gas distribution plant that supplies both domestic and industrial gas to homes and industries on the east coast.

We are about to becoming the biggest gas exporter in the world, and yet there is a gas shortage for domestic use and the price has escalated to crippling levels - and we are not getting the just rewards for the very product coming out of the ground - that is jointly owned by the Australian population.

Unfortunately, this can not be resolved by a Royal Commission, nor is it just an Australian problem.  These behemoths juggle intellectual rights and stock transfers between countries and into offshore tax havens in such a way that they meet the standards of accounting practice.  Should a country like Australia clamp down and force them to pay tax they have the ability to walk away from financing new industries and neglecting maintenance on existing local operations to inflict punishment on the Australian economy.

They have the monetary power to bluff the world and they play one country off against another and this is not helped by the power blocks in open conflict that prevent a united front to install commercial practice to stop these shenanigans.  It is not helpful that some countries actively assist the scams by deliberately lowering their tax regimens to attract these giants to locate to their country. They do this to gain from the jobs establishing regional headquarters will create, plus the nominal tax to be paid as part of the arrangement.

Sadly, if all the giant international companies paid the legitimate tax owed in normal accounting practice we would probably have balanced books and a very healthy economy.  It would seem reasonable to expect world countries to band together and install a common tax regime that would result in tax paid where the money was earned, but world politics make that unlikely to ever happen

It seems that the four banks facing a Royal Commission are only pygmies in relation to the giants of the commercial world.