news The Federal Opposition this week pledged to force tech companies like Apple and Google to pay their “fair share of tax in Australia”, with Shadow Communications Minister Jason Clare describing Apple Australia’s claim that it should only pay $85 million of tax on local revenues of almost $8 billion as “extraordinary”.
Earlier this week Apple sent its annual financial results document to the Australian Securities and Investments Commission. The document can be downloaded in PDF format here.
In the document, Apple reveals a remarkable set of figures about how its Australian operation has fared over the past 12 months. The company’s total revenue from its Australian operation rose by 29.5 percent in that period. The jump means that Apple made an extra $1.8 billion in its 2015 financial year compared with its 2014 financial year, with the company pulling in a total of $7.8 billion over the period from Australian customers.
However, despite the huge gain in its revenue in 2015, Apple’s Australian financial results reveal it only paid an extra $4.5 million of corporate income tax expense in the period, making a total of $84.9 million, compared with $80.3 million the previous year, when it made $1.8 billion less revenue. The company also claimed that it made $44 million less Australian profit than it did the previous year, for a total of just $208 million.
In response to the issue, Apple issued just a single statement, saying: “Apple Australia pays all taxes it owes in accordance with Australian law.”
The Federal Government last year passed legislation designed to tackle the tax situation of multinationals operating in Australia, and Treasurer Scott Morrison this week announced further measures as part of an international cooperation deal signed in Paris. In addition, the Australian Taxation Office is actively auditing Apple right now.
However, in an interview on Sky News on Wednesday, Shadow Communications Minister Jason Clare said the Government had not gone far enough on the issue.
“Here’s the biggest company in the world that made $8 billion in revenue in Australia last year and only paid $85 million in tax- that’s extraordinary,” Clare said.
“The other point I’d make Kieran is it’s even more extraordinary that this Government doesn’t have the courage to do something real about it.
“We’ve got a proposal in front of the Government which would make sure that multi-national companies pay $7 billion more in taxation to the Australian people over the next decade and the Government has rejected it out of hand. It should look at that again and do something serious about multi-national taxation.”
Clare pointed out that the Government had not attached a financial total for additional tax it believed it could raise through the multinational tax legislation it passed last year.
“We’ve got an additional measure that we have put forward to the Government. It will raise an additional $7 billion over the next decade for the Australian people from companies like Apple and Google that we think need to pay their fair share of tax in Australia,” said Clare.
“The Government has said no sorry that’s too hard, we are not going to do anything about that. Well I think that is pretty disappointing as well. People expect better from their political leaders when it comes to doing something serious about multi-national taxation.”
It’s a bit early to say how effective the Government’s multinational tax avoidance legislation will be, but I have to say it’s good to see Labor really starting to make this issue a large one.
Labor claims to stand for Australian workers — it’s not the party of capitalists or business owners. In this vein, you would have to imagine that corporations who send billions of dollars of profits offshore while paying almost no Australian tax should be public enemy number one.
Image credit: Parliamentary Broadcasting