Tax revenue up $6.4bn from large corporates, ATO reports
The ATO has secured record levels of tax revenue from large businesses and multinationals for 2022–23 following increased compliance intervention.
The ATO secured an additional $6.4 billion in tax from Australia’s largest business and multinational entities for 2022–23, reflecting the efforts of its Tax Avoidance Taskforce, the ATO said in a recent statement.
ATO Commissioner Chris Jordan said the record-high result is a product of the ATO’s vigorous scrutiny and continued compliance intervention into the large market.
“This additional revenue comes directly from our compliance intervention. It is an outstanding result that reflects years of sustained effort from the Tax Avoidance Taskforce to drive increased tax compliance by large businesses,” he said.
“The Taskforce scrutinises the tax outcomes of the largest 1,100 businesses and multinational groups to verify that they are paying the right amount of tax, and has helped to collect, on average, an additional $2 billion each year from public and multinational businesses. Last financial year’s result is three times more than this.”
Around $4.4 billion of last year’s result was due to the ATO’s earlier interventions in the oil and gas sector now flowing through the system, positively impacting tax collections, the Tax Office said.
This result largely reflects the ATO’s ability to capitalise on the success in the Chevron case, permanently removing more than $40 billion of past and future interest deductions for related party finance arrangements from the tax system.
“As a result, these large businesses are paying more tax and sooner,” the Tax Office said.
Mr Jordan said the ATO’s intervention and strong commodity prices mean that some oil and gas companies are now among the biggest taxpayers in Australia.
“Some of the revenue is already flowing through the system, positively impacting collections now and into the future,” he stated.
“We have been planting these seeds for many years and this work is now bearing fruit with significant outcomes for the Taskforce’s compliance and assurance programs.”
The record high tax revenue collected from large entities reflects the hard work undertaken by the Tax Avoidance Taskforce to challenge tax avoidance arrangements, said Mr Jordan.
“We will continue to hold public and multinational businesses to account to ensure they are paying the right amount of tax,” he said.
“We have confidence that most large businesses are doing the right thing and meeting their lawful tax obligations. The community can be assured the ATO will detect and pursue those organisations that try to game the system.”
Treasurer Jim Chalmers said he was pleased to see the crackdown on multinational tax avoidance and the billions of dollars in extra taxes collected from multinational corporations as part of the ATO’s Tax Avoidance Taskforce.
“The Tax Avoidance Taskforce has been a feature for some time in our budget but we’re seeing something like three times the benefit of that work and that’s a very good thing,” said Mr Chalmers.
“Every dollar that multinational corporations avoid paying means that ordinary people in middle Australia have to carry the can.”
Dr Chalmers said the extra $6.4 billion collected in the previous financial year would help the government fund its priorities and ensure that the tax system is fairer in the interests of ordinary people in ordinary communities.
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