The executives of the world's largest technology companies will be grilled by a Senate inquiry into corporate tax avoidance on Tuesday, as the government hopes to claw back $4 billion in missing tax revenue.
Google, Facebook, Apple, Microsoft, and IBM Australia leaders are all expected to appear at the inquiry in Sydney, while a 1000-person taskforce combs through the records of Australia's largest companies in a bid to turn around endemic levels of multinational tax avoidance.
Financial Services Minister Kelly O'Dwyer issued a blunt warning to all company executives ahead of the hearing.
"You don't get to choose whether or not you pay tax," she told Fairfax Media. "Companies that book sales in Australia are going to be taxed in Australia. This revenue ultimately goes to providing the services and the infrastructure Australians demand and expect."
While not commenting specifically on the companies appearing, Ms O'Dwyer said she had written to Finance Minister Mathias Cormann urging him to stop government contracts, sometimes worth more than $1 billion, being awarded to companies who do not pay the full company tax rate.
Google's director of international tax, Damon Richardson, will be interrogated by the economics committee less than six months after the $630 billion US company restructured its tax affairs to reflect the amount of advertising revenue it actually earned in Australia.
In April, following the introduction of the Multinational Anti-Avoidance Legislation, Google recognised $882 million in Australian advertising revenue for the first time.
"Google Australia made a pre-tax profit of $121 million and paid $33 million in corporate income taxes," a company spokesman said at the time.
In its submission it said it paid billions of dollars of corporate tax every year. "In fact our overall corporate tax rate in 2014 was about 19 per cent, a few percent lower than the OECD average of 25 per cent."
The company declined to comment ahead of the hearing but emphasised everyone "would benefit from a simpler, more transparent tax system".
Social media giant Facebook, who will also appear before the committee, declared its Australian revenue had suddenly increased tenfold in the space of a year after the introduction of the Multinational Anti-Avoidance Legislation.
After booking in an increase from $33.5 million to $327 million in revenue last year it paid $3.4 million in tax.
Computer giants Microsoft and IBM, who are scheduled to face questioning after lunch, are expected to come under increasing pressure to sign up to the federal government's tax transparency network.
IBM earned more than $4 billion in revenue in 2013/14 and paid just 9 per cent tax in that year after claiming research and development credits.
At the same time it has won a $1 billion contract to overhaul computing at the Department of Human Services as part of 178 tenders in the past decade.
Labor's shadow assistant treasurer Andrew Leigh called on the government to go further and introduce mandatory country-by-country taxpaying reports for multinationals.
"High-level tax information about where and how much tax was paid by large corporations [over $1 billion in global revenue] should be released," he said.
The Uniting Church's social justice spokesman, Mark Zirnsak, who will be the first to give evidence on Tuesday, said the companies have responded to legislative changes, but are only doing what is absolutely necessary to not fall outside the law.
"I'm not convinced they are paying legitimately what they should be," he said.
"The Multinational Anti-Avoidance Legislation has been a good start but it's not the whole story."