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ATO exposes tech titan tax records

After years of Government scrutiny over corporate tax avoidance, the ATO has released the tax files of Australia's top tech companies, revealing just how little the likes of Apple and Google pay each year.

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Seamus Byrne/CNET

While most Australians spend tax time manically sorting receipts and trying to eke out whatever tax deductions they can, new figures from the Australian Taxation Office show that many of Australia's top companies get through the financial year without paying a cent in tax.

The ATO has today released the tax details of more than 1,500 public Australian companies and foreign entities with an income over AU$100 million in the 2013-14 financial year. The results show that, among the corporations earning the most, less than 40 of them paid more than 10 percent in tax.

Australia's big technology names, the majority of which are based overseas or with offices in a number of territories, are among the top earners on the list, but also among those paying the lowest tax.

While the discussion about corporate tax avoidance can quickly get bogged down in the minutiae of Double Irish Sandwiches and Bermudan tax havens, the figures released by the ATO make for sobering reading. While Australians face paying close to 20 percent in tax for every dollar they earn over the $18,200 mark, many of the biggest companies in Australia paid close to 1 percent in the 2013-14 financial year.

For companies like Apple, that means paying just over 1 cent for each of the AU$6.15 billion dollars in total income it generated in the year. That AU$6 billion in income came down to AU$247 million in taxable income, with Apple paying AU$74 million in tax.

Company NameTotal Income (AU)Taxable Income (AU)Tax Payable (AU)Tax as % of Total Income
Acer $309,078,107--0.00%
Hewlett Packard$3,130,519,164--0.00%
Lenovo$372,184,669$132,344$39,7030.01%
Activision Blizzard$125,574,061$366,388$77,5260.06%
IBM$4,161,761,606$59,874,144$5,851,7300.14%
Sony$1,121,115,049$10,142,707$2,912,5160.26%
Samsung Electronics$2,755,658,196$45,978,314$13,793,4940.50%
Panasonic$468,650,565$9,655,259$2,896,5780.62%
LG Electronics$716,730,952$16,383,519$4,915,0560.69%
Philips Electronics$405,803,746$9,777,128$2,933,1380.72%
Dyson$187,611,971$5,421,286$1,587,5490.85%
Apple$6,152,690,557$247,363,687$74,100,6751.20%
Paypal$255,277,157$12,033,522$3,610,0571.41%
Epson$172,148,682$8,341,221$2,502,3661.45%
Nintendo$105,954,339$5,325,062$1,597,5191.51%
Symantec$162,323,013$9,316,618$2,794,9851.72%
Huawei$407,867,858$29,394,051$8,818,2152.16%
Dell$294,130,032$24,847,206$7,123,9262.42%
Google$357,734,831$90,894,056$9,206,4682.57%
Microsoft$567,752,818$103,886,168$31,165,8505.49%
iiNet$1,008,753,086$96,403,623$27,107,9452.69%
Singapore Telecom$8,572,522,495$867,888,618$238,891,5492.79%
Telstra$26,091,425,244$5,962,883,755$1,741,846,8206.68%
TPG$975,625,079$270,227,342$79,785,5078.18%
Vodafone Hutchison$3,567,085,248--0.00%

According to the ATO, the report is part of a "wider domestic and global push for improved corporate transparency" and is designed to "inform public debate about tax policy."

But while Australia's top companies might be earning billions, the issue comes down to how much of that total income is actually taxable and what companies do to avoid paying tax on all the dollars they bring into the bank. As the Federal Government has been at pains to point out, companies are not being targeted for illegal tax evasion, but for acting within the law, booking profits overseas and engaging in tax avoidance.

The Government has been shining the spotlight on corporate tax avoidance for a number of years, with a 2013 inquiry into IT pricing putting tough questions to the likes of Apple and Microsoft over how much tax they pay in Australia.

The issue made the headlines again in late 2014 when a United Voice report found that, of the top 200 companies in Australia, 14 percent had an effective tax rate of 0 percent. The Senate called for further scrutiny on the matter, and in April this year Google, Apple and Microsoft were once again asked to answer tough questions on their financial affairs.

Before leaving Parliament, former Federal Treasurer Joe Hockey introduced legislation for multinational companies with global revenues over AU$1 billion, tightening restrictions around making sales in Australian and booking revenues offshore.

The Federal Opposition also set its sights on tax reform by launching its "Fair Share" campaign in March, with Opposition Leader Bill Shorten saying at the time, "It isn't right that James Hardie pays less than James Smith the plumber."

Now, with the ATO opening the books on the top corporate earners in Australia, James the plumber will quickly learn just how little the big end of town is paying at tax time.

Let the public debate begin.