Feb 18, 2014

Why News Corp got almost $1 billion of your money

News Corp's $882 million tax refund has raised questions about the robustness of our tax laws.

Paddy Manning

Crikey business editor

It was a shock to all of us — including, apparently, the Prime Minister — to read yesterday that the Australian Tax Office had paid $882 million to Rupert Murdoch’s News Corporation last year, courtesy of this fine Neil Chenoweth piece in The Australian Financial Review.

The massive refund marked the end of a long-running legal dispute about the tax treatment of certain transactions dating back to 1989, when News Corporation, based and listed in Australia, was still the ultimate holding company funding Murdoch’s global empire — then including News of the World, The Sun, The Times and Sky Television in the UK, the New York Post and 20th Century Fox in the US, and more — and when Murdoch was juggling, in the aftermath of the Black Friday sharemarket crash, the huge debts racked up in his $20 billion-plus acquisition spree.

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16 thoughts on “Why News Corp got almost $1 billion of your money

  1. Bill Hilliger

    Yep privatise profits and socialise losses. The elderly American spiv has the Aussie system sussed. I suppose the forever loss making Australian lick-lick newspaper will now also be looking to the government for a handout. Rip, rip, rip!

  2. ernmalleyscat

    Thanks Paddy for actually attempting to explain the case and decision. The only example I’ve seen among acres of opinion in the last two days. Hopefully ATO and Treasury can press some government to address the tax laws.

  3. JohnB

    Yet another link through Bermuda.

    Isn’t it well past time for transactions with tax havens such as Bermuda to be entirely outlawed? Or, better, for force to be used to overthrow the joint and to toss the robber barons to the sharks?

    I suggest that this would be a far better use of naval might than patrolling the Indonesian border or scrambling jets to observe three Chinese ships cruising the international sea lanes between here and Singapore.

    Perhaps we could start small. Aren’t there smaller scale tax scams on Lord Howe (no Federal taxation) or Cook Islands (Principal commercial activity: “asset protection trusts”, ie protected, lawless, secretive money-boxes for the rich and/or criminal)? I envisage a joint operation with the NZ navy, whereby the two countries essentially invade their own possessions as practice for the real thing, which is Bermuda.

    Perhaps the British Navy could join in, warming up with a few Channel Islands victories before helping with the liberation of Bermuda from the tax-dodging classes.

  4. Electric Lardyland

    Nice thought, JohnB; though for this campaign to achieve popular support, it would probably need the backing of the mainstream media, and unfortunately, that media has a large percentage of tax dodger ownership.

  5. DiddyWrote

    So Murdoch nearly goes bust back in 1990, shuffles the debt around his empire by writing on bits of paper that all the red ink has now moved to Australia. Then 23 years later gets the ATO to hand him 882 million dollars claiming he’d been overtaxed because he had all this red ink scribbled on bits of paper. Nice work if you can get it.
    When the ATO decided not to appeal last year, why was this information not made public at the time?

  6. Dogs breakfast

    This is just an effing travesty.

    “the big tax refund to News is likely to again raise the issue of how much tax is paid by global corporations”

    Well it damn well should Paddy. If the G20 has anything to offer the world, then a tax system that isn’t a complete joke would be a good place to start.

  7. Dean Hubert

    I don’t think Rupert’s feeling particularly humble any longer.

  8. drmick

    We think he can do it again. He has been propping up the steaming edgar that is the oz for a long time. More losses to write off and he takes the money to bermuda again.
    Gee its good to be the sun king.

  9. Liamj

    How do the churnalists at News Corp integrate their paymasters taxdodging with their routine hated of anyone receiving government welfare? Are lobotomies part of the benefits package, or a prerequisite for hiring?

  10. AR

    LiamJ – if not lobotomies, certainly ethicdectomy.

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