The parent company of Optus, Singapore Telecommunications (Singtel), has once again reported zero corporate tax payments despite generating over $8.2 billion in income from Australian customers. This revelation comes as new figures indicate that the federal budget is increasingly reliant on contributions from the mining and banking sectors.
The Australian Tax Office (ATO) released its annual corporate tax report today, detailing the income and tax contributions of the nation’s largest private and public companies. In the 2023-24 fiscal year, more than 4,000 firms collectively paid $95.7 billion in tax on $3.3 trillion of income. However, Singtel, currently under scrutiny for its role in a Triple Zero outage, was not among the tax-paying entities. Despite declaring $8.2 billion in income, Singtel reported no taxable income or payable tax.
Corporate Tax Landscape: A Closer Look
This marks the fourth consecutive year that Singtel has reported over $8 billion in income without paying company tax. The last time Singtel paid tax was in the 2019-20 fiscal year, when it declared $181.8 million in taxable income on $9 billion in revenue and paid $43 million in tax.
Singtel is not alone in this trend. Global meat giant JBS, which has faced criticism overseas for minimizing its tax obligations, also paid no tax on $19.7 billion in income. Additionally, in the previous fiscal year, Qantas was the leading non-tax-paying company, but in 2023-24, it paid $8 million in tax on $21.6 billion of total income and $46 million of taxable income.
Other Notable Non-Tax Payers
- Netflix: $1.2 billion in income
- Transurban: $3.3 billion
- Toll Holdings: $2.9 billion
- Tabcorp: $1.9 billion
- Virgin Australia: $5.8 billion
- News Australia: $1.8 billion
A record low of 28 percent of large firms, more than 1,000, did not pay tax during the year. The ATO noted legitimate reasons for this, such as poor trading conditions or the utilization of previous year tax losses.
Mining and Banking: Pillars of Tax Contributions
The nation’s top 10 taxpayers included Windfield Holdings, a company heavily involved in lithium development, for the first time. It reported nearly $10 billion in income and paid $2.6 billion in tax on $8.8 billion of taxable income.
Rio Tinto was the largest single taxpayer, contributing $6.3 billion in income tax on $52.8 billion in total income, marking a $500 million increase from the previous year.
BHP Group followed closely, paying $6 billion on $62.5 billion in income, while its associate, BHP Iron Ore, paid $2.1 billion on $10.3 billion in income. Other significant tax-paying miners included Fortescue ($3.9 billion), Glencore Investments ($1.9 billion), Woodside ($1.7 billion), and Roy Hill Holdings ($1.4 billion).
Tax Trends and Economic Impact
The total tax paid by large corporations in 2023-24 was slightly down from the record $97.9 billion paid in 2022-23. This decline was primarily due to reduced contributions from the mining and energy sectors, which paid $48.5 billion on $679.1 billion in income, compared to $54.7 billion on $734.6 billion the previous year. Lower commodity prices were a significant factor, although tax from oil and gas firms increased to $10.4 billion as more businesses exhausted previously accrued losses.
Petroleum Resources Rent Tax (PRRT) collections fell to $1.5 billion from $1.9 billion, despite an increase in the number of companies paying the tax. The year marked the beginning of federal government PRRT reforms aimed at accelerating tax collections. However, a decrease in oil prices, production levels, and the decommissioning of some projects offset the increase in companies paying the tax.
Five entities associated with Woodside Petroleum paid PRRT in 2023-24, up from three the previous year. Among the new entities was Woodside Burrup, which contributed $150 million in PRRT.
Compliance and Future Outlook
Assistant tax commissioner Michelle Sams highlighted Australia’s high levels of tax compliance among large businesses, with 94.1 percent of tax paid voluntarily and 96.3 percent following compliance actions.
“The data continues to demonstrate the high levels of compliance amongst our largest corporates, which is what the Australian community expects,” she stated.
In the technology sector, Australian tech company Atlassian led in tax payments, contributing $252.8 million on $6.2 billion of income. In contrast, in 2022-23, it paid just $9.3 million on $5 billion of income. Microsoft paid $161.7 million on $8 billion of income, Apple paid $153.7 million on $12.4 billion, and Google paid $132.4 million on $2.1 billion of income.
As the federal budget continues to rely heavily on the mining and banking sectors, the spotlight remains on companies like Singtel and others that manage to navigate the tax landscape without contributing to the national coffers. The ongoing debate over corporate tax obligations and compliance is likely to intensify, with potential reforms on the horizon to ensure fair contributions from all sectors.
