The Australian Taxation Office (ATO) has published the tenth annual Corporate tax transparency (CTT) report revealing the ATO received $97.9 billion in income tax from large corporates, up 16.7% from the previous year.
ATO Deputy Commissioner Rebecca Saint reflected on another record year of tax paid by large corporates.
‘This is a great result for the Australian community. Tax paid in 2022–23 was again the highest since CTT reporting started. When you include the additional tax revenue raised by the Tax Avoidance Taskforce for the year, we collected around $100 billion from large corporates in 2022–23.’
Most sectors of the economy showed increased tax payable from the prior year. However, consistent with recent years the significant increase in tax came from the mining sector, this year with the oil and gas and coal sectors showing significant increases in tax contribution.
‘Tax paid by the oil and gas sector increased to $11.6 billion in 2022–23, with some oil and gas companies now amongst the largest taxpayers in Australia. This result 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 5 times than they did in 2014–15.’
‘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,’ Ms Saint said.
The 2022–23 report includes data from 3,985 entities, a net increase of 1,272 entities. Changes to tax laws mean that the CTT report now includes data for Australian-owned private entities with total income between $100 million to $200 million. This is to encourage voluntary compliance and increase the tax transparency of these large taxpayers.
Deputy Commissioner Saint reflected on the last decade of corporate tax transparency, highlighting the impact of the report on Australia’s largest taxpayers.
‘Providing transparency of corporate tax, the report has continued to improve accountability, encourage voluntary compliance and increase public awareness,’ Ms Saint said.
‘The first year of CTT showed large corporates paid nearly $40 billion in tax. Since this time, large corporates have paid more than half a trillion in tax in the last 10 years, before ATO compliance actions.’
‘Corporate tax compliance in Australia sets the bar for the rest of the world, and these results in part reflect years of sustained effort from the ATO’s Tax Avoidance Taskforce to drive and support increased tax compliance by large businesses,’ Ms Saint said.
‘Our tax gap estimates show that after ATO compliance activities, large corporates paid 96% of all income tax they should have for 2021–22. As they should be, large corporate groups are amongst the highest in net tax performance of all population segments. In part, this reflects the efforts of the Tax Avoidance Taskforce in holding large corporates to account.’
The percentage of those entities that paid no income tax has decreased since the first publication of the CTT report from 36% in 2013–14 to 31% in 2022–23.
‘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,' Ms Saint said.
The number of entities paying PRRT remained steady on the previous year, and PRRT payable slightly decreased from $1,996.6 million to $1,867.1 million.
Corporate tax transparency Report
The ATO is required under law to publish tax information reported to us by certain large companies each year. This year’s tax transparency report covers 3,985 corporate entities, of which:
- 1,646 are foreign-owned companies with an income of $100 million or more
- 600 are Australian public entities with an income of 100 million or more
- 1,739 are Australian-owned resident private companies with an income of $100 million or more.
The companies in the report paid a combined total of $97.9 billion corporate income tax in 2022-23.
This is the first year that data for Australian-owned private entities with total income between $100 million to $200 million is reported.
It is important to note that data in the report is taken directly from tax returns and does not reflect any intervention or compliance work after lodgment of the returns.
Tax Avoidance Taskforce
The Australian Government has provided funding to the ATO to support the Tax Avoidance Taskforce. The Taskforce significantly increases the ability of the ATO to focus on the compliance of large public and private groups and high wealth individuals.
With the support of the Taskforce, the ATO currently has resources deployed across a number of programs focused on the tax compliance of large corporate groups, including assurance programs, where we actively scrutinise the tax affairs of large business to ensure they pay the right amount of tax.
Since the Tax Avoidance Taskforce commenced in 2016, it has helped secure more than $33.2 billion in additional tax revenue from multinational enterprises, large public and private businesses (as at 30 September 2024).
Notes to journalists
- Corporate tax transparency report 2022–23 income year
- 2022–23 Report of entity tax informationExternal Link
- Findings report RTP – Public and multinational businesses
- Findings report – Top 100 income tax and GST assurance programs
- Public Groups and International Advice and Guidance program
- Findings report – Top 1,000 income tax and GST assurance programs
- Australian tax gaps (For information on Large business tax gap)
- Key Developments in tax administration in Australia
- ATO secures additional $6.4 billion from large corporates
