Others also support this view: The Large Format Retail Association stated that they ‘agree with the Australian Taxation Office’s view that a high rate of compliance is expected due to the desire of large overseas vendors and EDPs to avoid potential reputation risk or damage’ (LFRA, sub. 19, p. 7). The Australian Taxpayers’ Alliance and MyChoice argued that ‘companies that do comply will be motivated by international reputation, goodwill and corporate social responsibility policies’ (sub. 29, p. 7). Gonsalves contended that ‘large organisations such as Amazon will likely be compliant where tax obligations are clear, because it is generally within the interests of such organisations to be seen as good “corporate citizens”’ (sub. 7, attach., p. 10). The GST Distribution Review in 2012 that, under a vendor collection model, ‘the cooperation of overseas suppliers could be forthcoming for the bulk of transactions’ (Greiner, Brumby and Carter 2012, p. 160). Evans (2012) argued that ‘The clear theme, in my view, is that the offshore suppliers, whilst preferring not to incur the compliance costs of registration and reporting, will respond to gentle persuasion and simple compliance regimes’ (p. 12). Moreover, some commentators pointed out that corporate governance regulations in some countries may even compel foreign listed companies to comply with Australia’s regulatory regime (including tax regulations). For instance, Evans (2012, p. 12) suggests that ‘while it might be possible (as a matter of extrajurisdictional enforcement) to ignore Australian GST obligations’, the SarbanesOxley Act 2002 in the United States and other corporate governance requirements ‘mean that controls would be put in place to ensure compliance with the Australia law’. The enforcement toolkit Voluntary compliance is, of course, not sufficient and model proponents also point to the suite of ‘soft’ and ‘hard’ enforcement mechanisms available to the ATO. The ATO’s enforcement strategy uses both mechanisms and is based on encouraging foreign suppliers to meet their new obligations, by making the legislated model as simple as possible, taking a cooperative approach to compliance, and assisting foreign suppliers to fulfil their obligations (box 3.3). Box 3.3 The ATO’s strategy to encourage compliance
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