In its eighth annual CTT report, the ATO revealed that Australia’s biggest corporations paid more than $68 billion in tax.
ATO Deputy Commissioner Rebecca Saint said this year’s report represents 2,468 corporate entities, which paid a combined $68.6 billion in income tax, $11.4 billion or 19.8 per cent more than the previous year and the highest since reporting began.
High commodity prices were once again the key driver of the increase in corporate tax payments.
Australia has some of the highest levels of tax compliance for large business in the world with 93 per cent of tax paid voluntarily and 96 per cent after the ATO’s compliance activities.
“These results demonstrate there are high levels of tax compliance among our largest corporates,” Ms Saint said.
“The ATO is a world leader in combating tax avoidance by large corporate entities and the Tax Avoidance Taskforce (the Taskforce) bolsters our efforts to ensure companies pay the right amount of tax.”
Since 2016, the ATO has raised tax liabilities of $29.0 billion, with the taskforce funding helping generate $17.2 billion of this amount.
The ATO’s efforts to tackle tax avoidance have been further bolstered by the government’s budget announcement that it will extend the taskforce by a year and will also provide an additional $200 million per annum to expand the focus of the taskforce. This brings the total investment in the taskforce to $1.1 billion over the next four years.
“The Tax Avoidance Taskforce is able to identify and take action against those companies that don’t pay the right amount of tax and Australians should be confident that those seeking to avoid their obligations are being held to account,” Ms Saint said.
There are also several examples of companies committing to long-term behavioural change, including restructuring and settling longstanding disputes with the ATO that include “locked in” outcomes for future periods.
The percentage of entities paying no income tax has decreased to 32 per cent from a high of 36 per cent in 2015–16.
“We pay close attention to companies not paying tax. We hold those companies that report continual year-on-year losses to an additional layer of scrutiny,” Ms Saint said.
“While it’s true some large entities paid no income tax, we’re seeing through our justified trust program that there are high levels of compliance by these entities, and taking decisive action where there’s not.”
