A third of companies don't pay taxes in Australia

Friday, 08 Dec, 2017

One of the nation's most prominent media companies, News Corp Australia, declared $2.9 billion in income but did not pay a cent in tax.

Google Australia paid $16 million in tax for the year, off the back of taxable income of $121.9 million and total income of $501.8 million.

The Australian Tax Office (ATO) has listed Foxtel, News Australia and Dentsu Aegis Network as non-payers of local corporate income tax, as part of its 2015-16 corporate tax transparency report, released yesterday.

The report provides data on 2,043 entities, comprised of 1,693 Australian public and foreign-owned companies with an income of at least AUS 100 million (USD 75.12 million) and 350 Australian-owned resident private companies with an income of AUS $200 million (USD 150.24 million) or more.

Exxon Mobil, which has oil and gas production in the Bass Strait and a stake in the Gorgon LNG project among other assets in Australia, reported $6.7 billion in income but it reported a loss for taxable income and paid no tax, similar to the previous two years.

At the same time, Melbourne IT paid $434,705 in tax from $4.4 million in taxable income, off the back of $136.7 million in total income.

In the latest report, Hewlett Packard is not listed, but Dimension Data, with a total income again of AU$1.2 billion, did not report a taxable income, and therefore did not pay tax during the 2015-16 financial year either.

A probe by the Senate into corporate tax avoidance that began in 2014 was extended this week and is due to issue a final report by the end of May 2018.

It should be noted that it is highly likely a number of the companies in the list that reported taxable income of zero did so because they also reported a net loss during the period.

The Australian government legislated a new Diverted Profits Tax (DPT) in March, which is meant to prevent the practice of multinational organisations shifting profits made in Australia offshore to avoid paying tax.