AADA urges all Dealers to ensure their affairs are in order after the Australian Taxation Office (ATO) recently published the tax details of about 1,500 large corporate taxpayers, with plans to also report tax details in relation to 300 private corporations.
Commissioner of Taxation, Chris Jordan AO, said the Corporate Tax Transparency report forms part of a much wider domestic and global push for improved corporate transparency. He said it informs public debate about tax policy, particularly in relation to the corporate tax system.
“The transparency measure gives the community the opportunity to see some corporate tax data that the ATO holds,” Mr Jordan said in a statement.
“Community trust and have confidence in the way these large companies operate matters. And tax should matter to these companies. It is not something to be taken lightly. Collectively, these 1,500 large corporates paid almost $40 billion in company tax in the 2014 fiscal year.”
Mr Jordan stressed that no tax paid does not necessarily mean tax avoidance. Any companies with unusual financial or taxation numbers are closely investigated by the ATO. Over half of these 1,500 companies have been subject to ATO review or audit over the past three years.
“I am confident of the ATO’s oversight of these large players in our economy and of our ability to keep close watch on the revenue we receive,” he said.
“We recognise that the tax system works through willing participation by the majority of everyday Australians. Most large corporates, particularly domestic Australian companies, meet their tax obligations, notwithstanding that we do have some significant disputes with some of them.
“As for the role of foreign owned entities operating in Australia, investment from these companies should not be premised on no or very little tax being paid on significant profits generated in Australia. Some of these foreign owned companies are overly aggressive in the way they structure their operations. We will continue to challenge the more aggressive arrangements to show that we are resolute about ensuring companies are not unreasonably playing on the edge. If they do, they can expect to be challenged.”
Mr Jordan said publishing the data was a “step forward in improving corporate tax transparency”. The Government is working with the Board of Taxation to go further and develop a voluntary code so that complying companies can tell their own tax story in a reliable and consistent way.
“Large corporates now have to consider the impact of their tax information as a factor in managing their reputation with the markets, their shareholders, their consumers and in the Australian community,” he said.