The Senate committee is examining the effectiveness of Australia's current tax laws, the work of the Australian Tax Office and whether more transparency is needed to deter profit shifting and tax avoidance.
Tax avoidance is not illegal: it's the use of tax laws to reduce the amount of tax payable.
Tax evasion is the illegal evasion of taxes by individuals, corporations or trusts.
Greens leader Christine Milne, who initiated the inquiry supported by Labor, says there needs be greater transparency about how corporations organise their tax affairs, and the way they're treated by the Tax Office.
In calling for the inquiry she told the Senate there's rising community and political concern that multinational companies are not paying their fair share of tax in Australia.
"Australians are absolutely fed up with the fact that the government has gone after ordinary people, making their lives harder, and has let the big end of town completely off the hook. According to the Tax Office, most corporates pay the tax they are required under Australian law. If that is the case, there is a lot wrong with the Australian law when it comes to tax avoidance and tax evasion."
Representatives of Google, Apple, Microsoft, News Corp and the mining corporations BHP Billiton, Rio Tinto and Fortescue Metals Group are due to appear before the committee.
Treasurer Joe Hockey has already said the government is considering legislation to force multinationals to pay tax in Australia and has given extra funding to the tax office to track down offenders.
"The ATO has additional resources to identify whether those companies are not paying their fair share of tax in Australia.
This is part of a coordinated effort from the Australian Government. There is a global warning message to multinationals.
You have to pay tax where you earn the profits. Wherever you are located, the developed world has had enough. The developed world has had enough. We are not going to cop this sort of minimisation and in certain circumstances avoidance and even evasion. We're not going to cop that any more."
Mr Hockey is also tipped to use the May budget to unveil new measures to address profit shifting.
I should bluddy think so too. Go after the big money cheats instead of rying to claw money out of the taxpayer and age pensioners, and trying to tax bank deposits of money already taxed.
