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The Tax Office has revealed that it received $97.9 billion in income tax from large corporations in its tenth annual corporate tax transparency report.
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Large corporations cough up $100bn in corporate tax
01 November 2024
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The ATO published its tenth annual Corporate Tax Transparency (CTT) report today, revealing that income tax received from large corporations increased by 16.7 per cent from the previous year.
The tenth report captured the 2022–23 financial year.
ATO deputy commissioner Rebecca Saint said it was a great result for the Australian community.
“Tax paid in 2022–23 was again the highest since CTT reporting started,” Saint said.
“When you include the additional tax revenue raised by the Tax Avoidance Taskforce for the year, we collected around $100 billion from large corporations in 2022–23.”
The tenth annual CTT report covered 3,985 corporate entities and highlighted that 1,646 were foreign-owned companies with an income of $100 million or more and 600 were Australian public entities with an income of $100 million or more.
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The report also demonstrated that 1,739 entities were Australian-owned resident private companies with an income of $100 million or more.
Combined, the companies paid a total of $97.9 billion of corporate income tax in 2022–23, the first year that data for Australian-owned private entities with total income between $100 million to $200 million was reported.
According to the report, most sectors demonstrated an increased tax payable from last year.
Previously the mining sector contributed a substantial tax contribution, however this year the oil, gas and coal sectors showed a significant increase in contribution.
In 2022–23, taxes paid by the oil and gas sector increased to $11.6 billion, marking the sector's companies as some of the largest taxpayers in Australia.
Saint said this was driven by a combination of commodity prices, the project production life cycle and ATO intervention.
“2022–23 is the second year in a row that the mining sector paid more tax than all other sectors combined, paying more than five times than they did in 2014–15,” she said.
“We continue to see improvement in the tax compliance of large businesses, reflecting how the ATO’s Tax Avoidance Taskforce has supported improvement in voluntary compliance in addition to strong compliance actions.”
Saint noted the first year of CTT showed large corporations paid nearly $40 billion in tax and had since paid more than half a trillion in tax in the last 10 years.
According to the Tax Office, corporate tax compliance in Australia set the bar for the rest of the world and couldn’t be achieved without the ATO’s Tax Avoidance Taskforce.
ATO tax gap estimates found that after ATO compliance activities, large corporations paid 96 per cent of all income tax they should have for 2021–22.
The percentage of entities that paid no income tax decreased since the first CTT report, from 36 per cent in 2013–14 to 31 per cent in 2022–23.
The number of entities that paid PRRT remained steady on the previous year and PRRT payable slightly decreased from $1.996 billion to $1.867 billion.
Saint said the CTT report highlighted the efforts of the Tax Avoidance Taskforce and the ATO in holding large corporations to account.
“While there are legitimate reasons why a company may pay no income tax, the Australian community can be assured we pay close attention to those who pay no income tax to ensure that they are not trying to game the system.”
“Providing transparency of corporate tax, the report has continued to improve accountability, encourage voluntary compliance and increase public awareness.”
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