One third of big companies paid no tax and now celebrities are put on alert amid a tax crackdown

Celebrities and social influencers are on high-alert amid a crackdown on tax avoidance.

A tax blitz will be launched against high-profile figures, who are dodging the system to avoid paying tax.

The Courier Mail reported the Treasury Department is consulting on the crackdown and it is another step as the Australian Federal Government tamps down of tax avoidance.

Online influencers often licence their fame or image to a company or trust. As a result they end up paying less tax.

A tax blitz will be launched against high-profile figures, who are dodging the system to avoid paying tax (pictured, Australian Taxation Office)

The Courier Mail reported the Treasury Department is consulting on the crackdown and it is another step as the Australian Federal Government tamps down of tax avoidance (stock photo)

The Courier Mail reported the Treasury Department is consulting on the crackdown and it is another step as the Australian Federal Government tamps down of tax avoidance (stock photo)

The growing trend comes as influencers on sites like Instagram, Facebook and Twitter rake in more revenue as they collect more loyal followers.

‘When individuals begin to develop fame and a public following, they can also earn income from their fame or image,’ a Treasury Department document said.

‘The exploitation can consist of advertisements, sponsorships, including wearing associated products, public appearances and the promotion of products.’

While social media influencers are paid increasing amounts of money to spruik products like clothes, makeup and luxury products, some high-profile figures use loopholes to pay less tax.  

‘There is evidence that … individuals are splitting or apportioning, lump sum payments to shift more income outside of their personal accessible income,’ the Treasury said. 

The crackdown comes after the latest corporate tax transparency report blew the whistle on a large number of companies that avoided tax over the past year, the ABC reported.

About one-third of large companies failed to pay tax, even though they pulled in a gross profit.

The Australian Taxation Office (ATO) monitored 2,109 entities, of which only 66 per cent paid tax.

The remaining companies argued they claimed tax losses and concessions dating back several years. 

‘Sensitivity to economic conditions, reinvestment back into the business, distribution of profits to other entities within the broader group, tax deductions and tax offsets can all affect the amount of taxable income and tax payable,’ the transparency report said. 

ATO commissioner Jeremy Hirschhorn (pictured) said the benefit of a crackdown on multinational tax avoidance was already showing

ATO commissioner Jeremy Hirschhorn (pictured) said the benefit of a crackdown on multinational tax avoidance was already showing

According to the ATO, there was a 19 per cent hike in the total corporate income tax collected in the period.

The growth of $7.5 billion was thanks in part to 68 more companies receiving tax. 

ATO commissioner Jeremy Hirschhorn said the benefit of a crackdown on multinational tax avoidance was already showing.

He noted companies had started to restructure their tax affairs to make sure they kept within the law. 

‘In coming years, the full effect of the Multinational Anti-Avoidance Law (MAAL) will flow through as multinational companies book billions more in sales locally,’ Mr Hirschhorn said. 

Treasurer Josh Frydenberg also chimed in and said the ATO had been able to strengthen its watch on the largest 1,000 public and multinational groups thanks to budget funding. 

Though shadow assistant treasurer Andrew Leigh remained skeptical, as one third of monitored companies still paid no tax.

‘Australians don’t want the world’s biggest tax loopholes, they want the best schools and hospitals,’ he said.

Oxfam Australia chief executive Dr Helen Szoke said the government’s refusal to bring in tougher measures on tax transparency, meant large companies continued to exploit the system. 

Tax Justice Network’s Mark Zirnsak pointed out foreign-owned multinational corporations accounted for 36 per cent of corporate income in Australia.

Despite this fact, they only brought in 18 per cent of reportable profits.

He said this illustrated the reality some corporations were more aggressive in their tax arrangements and made it their mission to avoid tax payment in the country.   

Treasurer Josh Frydenberg (pictured) also chimed in and said the ATO had been able to strengthen its watch on the largest 1,000 public and multinational groups thanks to budget funding

Treasurer Josh Frydenberg (pictured) also chimed in and said the ATO had been able to strengthen its watch on the largest 1,000 public and multinational groups thanks to budget funding

Read more at DailyMail.co.uk