While the Business Council of Australia (BCA) continues to demand a cut in the rate of company tax, its members are paying well below the statutory level of tax, and many pay none at all.
The government insists that large corporations and multinationals are being forced to pay more tax through the closing of lucrative rorts such as transfer pricing and intra-company loans. And there’s some truth to that claim. Most of the BCA’s 130-odd members appear in the ATO’s large company tax data, excluding major law firms and the big four accounting firms, which are partnerships. Thirty of the firms paid no tax at all — down noticeably on 2017-18 — on more than $8.1 billion in taxable income and more than $78 billion in revenue.
Among the non-paying BCA members are Woodside, Amcor, Alumina Ltd, BAE, Lendlease, MYOB (previously run by new BCA chair Tim Reed; MYOB paid no tax on $368 million in revenue and $114.3 million in taxable income), Orica, Shell and Transurban. Chevron earned over $5 billion but managed to make no taxable income at all, as did Virgin Australia; Mirvac made $1.9 billion in earnings but that translated into just $770,000.
Other low payers included Incitec Pivot, which paid just 3% and Downer EDI 5%; serial dodger Qantas finally forked out 11%, Google, a serial tax offender around the world, 20%.
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But 48 BCA members paid full freight, coughing up 29% or 30% tax. That number is also up significantly from 2016-17 — although how much their taxable incomes are an accurate reflection of profitability is a good question. Microsoft, which has been criticised for dodging tax in the past, had $2.2 billion in revenue but just $204 million in taxable income. AGL had $12 billion in revenue but just $64 million in taxable income; Caltex managed $728 million in taxable income from $20.5 billion; Orica just $1 million from $197 million in revenue.
Despite this, the average tax paid by a Business Council member in 2017-18 barely shifted from 2016-17. As Crikey reported this time last year, BCA members paid on average 25.3% tax that year. According to the ATO’s latest round of company tax data, that increased to a whopping 25.5% in 2017-18.
The BCA’s constant demands for lower company tax rates would have at least a modicum of credibility if the bulk of their members actually paid their way rather than exploiting loopholes to pay nothing at all.