Tax crackdown comes as government unveils plans to reduce foreign aid Australia on Tuesday proposed new legislation to tighten tax loopholes that the conservative government says have allowed around 30 of the world's largest multinational companies to avoid paying taxes.

Under the proposals, released as part of Australia's 2015-16 federal budget, companies with more than A$1 billion ($790 million) in global revenues that are found to have intentionally avoided paying tax in Australia could be pursued for lost taxes.

With the new measures Australia will join the United Kingdom in leading a crackdown on companies such as global tech giants, Apple and Microsoft, focusing particularly on their alleged shifting of profits from high-tax countries to low or no tax regimes.

"We have identified 30 large multinational companies that may have diverted profits away from Australia to avoid paying their fair share of tax in Australia," Treasurer Joe Hockey told parliament.

"Under this new law, when we catch companies cheating, they will have to pay back double what they owe, plus interest."

Under Australia's leadership last year, the Group of 20 leading economies endorsed a set of common standards of sharing bank account information across borders with automatic exchange of information among its members.

The Australian units of Google, Apple and Microsoft revealed earlier this year they were "under review" by the Australian Tax Office (ATO), which had declined to renew agreements with the companies on transfer pricing.

That accounting practice, under which a company sets internal prices for goods to its subsidiaries, has been blamed for helping large companies minimize their tax bills by lowering the cost of those goods to subsidiaries in high-tax regimes.

Pressure from the United States and the consensus nature of the OECD have made tackling this issue extremely difficult, said Antony Ting, an associate professor of economics at Sydney University.

"I think if Australia really wants to protect its tax base, we really need to think about something like a Google Tax or this kind of unilateral action," he told Reuters, using the colloquial term coined for Britain's proposed diverted profits tax.

Apple's revenues in Australia grew from around A$3.5 billion in 2010 to A$6.1 billion in 2013, while its taxable income went from A$166 million to A$240 million during the same period.

And while Australia does not represent these companies' largest market, it is a significant and influential one.

Still, unilateral action is not without risks.

"It's unwise and ill-advised and irrational to depart from current approaches and agreements expressed in OECD rules," George Barker, an expert on taxation law and economics at the Australian National University's Centre for Law and Economics, told Reuters.

Foreign aid cut

In addition, Hockey announced cuts to foreign aid, lower taxes for small businesses and cheaper childcare in an annual budget that tries to balance paying off debt.

Hockey revealed to parliament on Tuesday a budget blueprint that will deliver a surplus in the 2019-20 fiscal year despite a recent slump in the price of iron ore, Australia's most lucrative export.

The deficit for the current fiscal year is forecast at A$39.4 billion, less than the A$40.4 billion predicted in December but A$10 worse than the government had forecast a year ago.

Cuts in spending will be used to finance new programs including A$5.5 billion to give more than 2 million small businesses tax breaks and A$4.4 billion to help 165,000 parents pay for childcare.

Indonesia is the biggest loser from Australia's plan to slash its foreign aid budget by almost 20 percent to A$4.1 billion in the next fiscal year which begins on July 1.

Weeks after recalling its ambassadors from Jakarta in protest at the executions of two Australian drug traffickers, the government plans to cut Indonesian aid by 40 percent next year to A$323 million.