168 of Australia’s largest corporations have paid no tax since 2013, while raking in profits of more than $9.85 billion, the new data revealed on Saturday.
They are among the companies listed in the Australian Taxation Office’s numbers, which reveal the revenue, earnings, and tax paid by almost 2,300 of the country’s largest enterprises in the 2019-20 financial year.
The number is increasing every year as one-third of the 2,370 businesses in the 2019-20 data set, or 782, did not pay any taxes in that year.
Previous ATO data dumps cover the years 2013-14 to 2017-18, allowing Australia to establish which businesses in the figures have not paid tax over the seven years for which figures are available.
Household brands such as property developer Lendlease and the Australian subsidiaries of multinationals such as oil and gas company Chevron and German engineering and technology group Bosch are among the companies that paid no tax during the time.
The reasons for the corporations’ failure to pay taxes differ. Some, such as Lendlease, are members of property trust organisations, in which the investor, not the corporation, is responsible for paying taxes.
Some corporations that did not pay taxes, such as BHP and Rio Tinto subsidiaries, are members of corporate groups in which another entity paid their taxes on their behalf.
Others, such as Chevron Australia Holdings, an Australian Chevron subsidiary, have substantial losses from previous years that they can use to reduce their tax obligations.
The data also shows Qantas’ rollercoaster ride as it went from a $2.8 billion loss in 2013-14 to a profit in 2014-15. It took until 2017-18 for the airline to eat through its losses from the previous year and pay some tax – a relatively small $11 million.
The corporation paid substantially more in 2018-19, $259 million, on the back of $942 million in taxable revenue (the tax equivalent of profit).
However, the coronavirus outbreak, which forced the airline to ground much of its fleet, resulted in a $1.9 billion loss in 2019-20 and a tax bill of zero. Even as air travel resumes after the pandemic and the company returns to profitability, Qantas lost another $2.35 billion last year, indicating that it is unlikely to pay tax for several years.
ATO deputy commissioner Rebecca Saint said there are “valid reasons why a firm may not pay tax” ahead of the release of the most current batch of corporate tax transparency numbers.
“Just because a business doesn’t pay tax doesn’t mean it’s engaging in tax evasion or other similar behaviour.” “There could be a compelling commercial case for it,” she remarked.
“We have a great level of trust in those firms that do not pay tax, and what I mean by that is that we have gone out of our way to see if those losses are the result of commercial activity rather than tax avoidance schemes.”
