Big multinationals still dodging tax
Written by: Nick G. on 13 December 2019
Latest figures from the Australian Tax Office (ATO) show that big multinational corporations are continuing to evade their obligations to pay tax on their Australian earnings. They have been doing this for many years, but the ATO has only made data available since the 2013-14 financial year.
The figures for the 2017-18 financial year, the fifth in a series of annual reports on the tax status of entities considered to be the biggest 2200 companies in Australia, showed 32% paid no tax on billions of dollars of Australia revenue.
BCA Member Company |
Total Income |
Tax Payable |
Tax Paid |
Accenture |
2,139,397,646 |
110,877,856 |
32,392,961 |
AGL Energy Ltd |
11,937,111,946 |
9,526,762 |
2,786,458 |
Alcoa of Australia Ltd |
4,606,084,558 |
1,474,280,687 |
438,797,274 |
Alumina Ltd |
392,076,018 |
497,596,404 |
Nil |
Amcor Ltd |
5,081,720,569 |
Nil |
Nil |
Total |
24,156,390,737 |
2,092,281,709 |
473,976,333 |
The figures show that these five companies alone were able to reduce their tax payable to a mere 8.6% of their income, and paid tax of only 1.9% on that income.
I don’t know many workers who can evade tax to that extent!
The rorts embedded in the company tax system that allow tax refusal on this scale include:
• carrying over losses from previous years,
• inbound supply chain rorts where local subsidiaries of multinational companies are charged over the odds for goods they sell in Australia, locking the profit away offshore,
• related party finance deals under which offshore companies in a multinational loan their Australian associates money at usurious rates, making sure little or no profit is made locally, and
• companies selling intellectual property, such as patents, to an offshore affiliate for less than the IP cost to develop and then lease it back.
Although under significant public pressure to make companies comply with their tax obligations, the Australian Tax Office treads very gently around the issue.
ATO deputy commissioner Rebecca Saint claimed that “voluntary compliance with tax law by big companies” had improved, but was still in need of further improvement.
So, the core of the ruling class, by the ATO’s own admission, is subject only to “voluntary compliance” with Australian tax law.
That means big foreign-owned multinationals like ExxonMobil which savaged its workforce at Longford in Victoria, demanding they accept wage cuts and cuts to annual leave and shift loading, paid no tax on the income their workers had made for them.
For the record, ExxonMobil paid no tax on Australian earnings of $9,617,324,823 in 2013-14; on $8,464,272,972 in 2014-15; on $6,728,562,395 in 2015-16; on $8,360,800,462 in 2016-17; and now, on $9,234,164,781 in 2017-18. So, over five years, ExxonMobil has had an income of $42.3 billion in Australia, and paid not one single cent to the AT0!
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