Sandwiched between a story on a Gold Coast diet blogger accused of pinching other people's recipes and and the tale of a solicitor who fleeced a dementia patient, Channel Nine's A Current Affair entered the debate on Australia's company tax system. It was unusual terrain for the tabloid TV show to cover.

More than a million people watched the segment titled "Tax dodgers named and shamed". It was the moment the festering issue of corporate tax dodging jumped from the pages of the financial and broadsheet press and firmly into the mainstream.

The media circus around the appearance at the inquiry of the heads of Google, Apple and Microsoft completed the process.

Hockey's senior media adviser is the former journalist Mike Willesee Jr, son of A Current Affair's most famous host Mike Willesee and nephew of Terry Willesee who anchored Channel Seven's Terry Willesee Tonight.

Willesee jnr is a man with tabloid TV in his DNA and must have understood the potential danger to the government in ordinary Australians – the people who give up about 25 per cent of their pay packet each week to the tax man – wising up to how the wealthiest global corporations – household brands like Apple, Google and Microsoft – pay virtually no tax in Australia.

Polling of key marginal seats, including the NSW bellwether electorate of Eden-Monaro, revealed by Fairfax Media on Tuesday, found a staggering 90 per cent of people believe the government has failed to tackle the corporate tax dodgers.

The issue has exploded at a time when the treasurer is already battling stiff fiscal headwinds like plummeting iron ore prices and pressure to frame a "fair" budget in May.

How can Hockey's second budget pass the fairness test if middle class superannuation holders are, as expected, asked to do the lifting this time round when foreign corporations and the largest Australian companies are sidestepping tax by channelling billions of dollars offshore and using every trick in the book to lower their tax bills?

Fairfax Media revealed last week that the largest 900 Australian companies save $25 billion a year through a range of tax deductions, exemptions and write-offs for research and development – a sum that would wipe out two-thirds of the current budget deficit at a stroke.

On the other hand, how can Hockey cut through the complexity and interwoven nature of the global tax system to claw back a greater contribution from multinational companies without denting Prime Minister Tony Abbott's election night boast that Australia was "open for business"?

Figures who have the ear of Hockey and Abbott see the danger in the Coalition government appearing as the dog being wagged by the tail of big business.

Liberal pollster Mark Textor notes that "people vote in governments to solve the problem, and giant multinationals not paying tax is a problem". But he also believes people's views are more nuanced than superficial polling questions might reflect.

"Of course they say they want companies to pay their fair share but more broadly they want to see a tax system that adapts to the changing nature of the economy," he tells Fairfax Media.

Inside the government, Liberal senator Bill Heffernan has been telling anyone who will listen that corporate tax evasion is a "threat to sovereignty" right across the western world.

The government appears to have woken up to the electoral risks. Last week, Hockey lauded the contribution of the biggest blue chip companies and released a tax discussion paper that made only passing reference to any problems with corporate tax.

On Thursday, he conceded that the way the big multinationals go about their tax minimisation is "desperately unfair" to small businesses paying 30 cents in the dollar.

Assistant Treasurer Josh Frydenberg opened an interview on ABC's Lateline program on Wednesday with the admission: "Certainly there is a problem with ensuring that these multinationals pay their appropriate level of tax".

Talk at the inquiry of "double Irish sandwiches" – a tax avoidance strategy used by Apple – only served to reinforce the perception that Australia is being played for a mug by the slickest corporations.

According to accounts filed with ASIC, Apple Australia paid about $80 million in tax last year on profits of $250 million and revenue of more than $6 billion.

Google's Australian arm paid $7.1 million in tax in 2013 on profits of $46 million and revenue of $357.7 million.

The issue for governments, which goes to the heart of the amount of tax these companies pay, is where they count their revenue and profit.

The Australian Taxation Office's submission to the inquiry into corporate tax avoidance shows that in 2012-13 $388.4 billion – more than half of Australia's trade – is money sent offshore by companies to their overseas arms.

The top nation where this money – made mainly by the nation's 30 largest companies – flowed to was Singapore. The tiny island nation's company tax rate is just 17 per cent, but can be reduced by companies even further through a range of incentives. More $100.4 billion worth of "related-party flows" went through Singapore in 2012-13.

Antony Ting, a tax expert at the Sydney University Business School, explained during the hearings how Apple were masters at shifting their profits offshore.

Money for each iPad bought in Australia doesn't stay here. According to Ting, of a $600 sale price, $550 is paid to Ireland – where Apple has a subsidiary and where the company tax rate is just 12.5 per cent.

This leaves very little profit to be taxed in Australia, but Ting says it gets worse: out of the $550 paid to Ireland, $220 is never taxed anywhere in the world.

Microsoft also transfers money to Singapore. The company's global tax chief Bill Sample – who flew down to Australia especially for the hearing – said there had been $2 billion in software product and service revenue booked in Singapore, but only $100 million in Australia.

Google Australia and New Zealand managing director Maile Carnegie said revenue gained by Google for advertising services from Australia customers was booked in Singapore. She would not say how much, but it's estimated about $2 billion goes through Singapore.

Apple's Tony King wouldn't say how much of the company's $6 billion revenue booked last year went overseas. He claimed he didn't even know what a double Irish sandwich was.

But he did admit Apple Australia buys products such iPads and iPhones from its overseas operations, resells them here, and then gets taxed on its local profit.

"We purchase our products on an arm's length basis from affiliates and declare all of our income in accordance with Australian tax law," Mr King said.

In evidence King noted that for the past decade Apple has entered into deals with the ATO, known as Advanced Pricing Agreements, that lock in the taxes companies pay ahead of time.

Last year, as political pressure on the ATO to do something about profit shifting rose, the Tax Office rejected an APA application from Apple, Microsoft and Google. All three companies are now under audit.

So far, Hockey's only likely solution to the problem is a "diverted profits tax" like the "Google Tax" promised by the British government of Conservative Prime Minister David Cameron just before he called the election campaign there. He will also seek GST on digital downloads – a so-called "Netflix tax".

Experts believe the British plan is not only an election stunt but an attempt to bring the United States administration to the table in forcing its homegrown multinationals like Microsoft, Google and Apple to pay tax where they make their money.

KPMG tax partner Grant Wardell-Johnson says it would be a big mistake for Australia to jump the gun and take unilateral action now when the OECD's 15-point action plan – which will give guidance on a host of important tax issues to all governments – will be largely finished by September.

"It is not long to wait. Their plan will give a solid framework from which Australia and other countries can base their laws around so that we end up with a coherent international tax system, fit for the digital age which we now live in," he said.

The Parliamentary Budget Office has already warned that a diverted profits tax could break Australia's international tax treaties and incite other countries to slap special levies on Australian businesses in return.

Wardell-Johnson agrees. "If Australia or other countries copy what the UK has recently done and introduce a so-called diverted profits tax in an attempt to gain more revenue it could lead to a proliferation of similar taxes that fall outside the system of tax treaties, which govern international tax."

"That would be a bad outcome and could undermine the OECD's efforts to improve the system."

Hockey said the government had "worked damn hard through the G20 and with the OECD, to have global integrity measures in place".

"We are working with them on a continuing basis," he said. "But we are absolutely determined to do whatever we can, as soon as we can, to ensure that people pay the tax that they should pay in the jurisdiction where they earn that income."

This was not a "grab for revenue", but rather, about the "integrity" and "fairness" of the tax system, Hockey said.

The tax evasion inquiry may not have got the oxygen it received this week but for the political manoeuvrings that go on in the Senate.

Seeking to capitalise on Fairfax Media's September report into research by the Tax Justice Network that a third of Australian companies pay as little as 10 cents in the dollar corporate tax, Greens leader Christine Milne proposed a quick and dirty inquiry that would report by the end of the 2014 parliamentary year in late November.

Due to the workload of Economic References Committee chairman Sam Dastyari, Labor convinced Milne to agree to a longer timeframe. The extra time allowed for public hearings that would not have been possible under the original proposal.

Senator Dastyari's star rose further as he berated Tax Commissioner Chris Jordan and Hockey for protecting the names of companies that channel billions into low-tax Singapore in the tax year 2011-2013. But it has not escaped everyone that it was Labor in power when those profits were merrily being repatriated.

Treasury Deputy Secretary Rob Heferen admitted during hearings that Treasury had no idea how much potential revenue Australia was actually losing.

"This probably matters more to us than almost any other country … [but] how big an issue, putting a figure on it, we just don't know," he said.

The committee will land an interim report in the week or so before the May budget.

The OECD will release its 15-point action plan in October, but the plan isn't expected to be implemented until after 2017 - and that's if governments implement it at all.

Hockey needs to be seen to be doing something long before then.

Microsoft

Say they are paying an effective tax rate above 30% but revealed last week that $2b in software and products had been booked through Singapore and only $100m through Australia.

Google

Paid Australian tax of $7m in 2013 on $46m profit and revenue of $358m, a rate of 15%. This does not include an estimated $2b income earned locally through its search engine business that is booked or reported to Singapore.

Apple

Apple Australia paid about $80m in tax last year on profits of $250m and revenue of more than $6b.

Corporate tax avoidance

September 2014

Fairfax Media reveals that research by the Tax Justice Network shows a third of Australian companies pay as little as 10% in corporate tax.

October 2, 2014

Greens and Labor team up in Senate to refer an inquiry into corporate tax avoidance to the Senate Economics References Committee, chaired by Labor's Sam Dastyari.

April 2015

Heads of Microsoft, Google and Apple and other multinationals appear during three days of public hearings. May 2015 Inquiry expected to issue an interim report.