Pulse Alert – News Pulse for January 7, 2019

A daily download of SME, startup, fintech and tax news from around Australia.

Why Australia must not rush to tax the digital giants

Taxation of the digital giants has been exercising governments for years now – and things are coming to a head. It was a key part of the OECDOrganisation for Economic Co-operation and Development’s long-running Base Erosion and Profit-Shifting agenda but the UK recently announced that with international agreement still not reached, it was going it alone, and is intending to introduce a Digital Services Tax (DST).

France then announced it was moving even more quickly, and introduced its own digital tax from January 1 . But opposition from several European Union member countries has prevented any EU-wide announcement – it is likely that the EU will wait for the OECDOrganisation for Economic Co-operation and Development and what is called the Inclusive Framework of more than 100 countries to come up with a long-term solution.

Preventing multinational tax avoidance by strengthening Australia’s tax treaties | The Hon Stuart Robert MP

The entry into force of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting from 1 January 2019 again shows the commitment of the Morrison Government to make sure multinationals pay their fair share of tax to Australia.

The Convention, commonly known as the OECDOrganisation for Economic Co-operation and Development Multilateral Instrument, is a key output of the OECDOrganisation for Economic Co-operation and Development/G20 Base Erosion and Profit Shifting agenda, which the Government has firmly supported. Australia ratified the Convention on 26 September 2018.

Open banking boosts competition

It takes a lot of work to convince a borrower to overcome their ­apathy and seek a better deal for their mortgage.

Despite a royal commission, a Productivity Commission inquiry into competition in the financial services sector and an ACCCAustralian Competition and Consumer Commission The ACCC is Australia's competition regulator and national consumer law champion. investigation of mortgage pricing, less than 4 per cent of borrowers switched their home loans to another lender in the year to June 2018.

Small business lending’s champions

The Australian Finance Industry Association’s code of conduct for online small to medium business lending has found its team of enforcers, with former FlexiGroup chief executive Symon Brewis-Weston leading the independent committee in charge of ensuring fintechs toe the line.

The committee will have the power to investigate potential breaches of AFIA’s code, including the ability to conduct audits into the processes and systems of lenders that have signed up to it.

Top seven fintech business lenders compliant with new code of conduct

The seven largest online small business lenders have opened themselves to scrutiny by an independent oversight committee and pledged to adhere to transparent standards on pricing and dispute resolution, with the Australian Finance Industry Association and small business ombudsman endorsing the start-ups’ efforts at self-regulation.

Prospa, Moula, OnDeck, Spotcap, Capify, GetCapital and Lumi now comply with the Online Small Business Lenders Code of Lending Practice, the creation of which was announced early last year.

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