Corporates dodge taxing questions
UPDATE 12.45pm: Bermuda has a company tax rate of zero.
In Ireland its 12.5 per cent and, with the Netherlands, has given the world the term “Double Irish Dutch Sandwich”.
But a trio of prominent Australian business leaders have denied the tax links of their companies to the three offshore tax havens has anything to do with their tax rates.
In front of a Senate committee that is examining multi-national tax avoidance, the mere suggestion that Bermuda, Ireland and the Netherlands were being used for their tax arrangements was treated with disdain.
Chevron Australia managing director Roy Krzywosinski said Bermuda was well known because of its “maritime safety” record – not noting its proximity to the Bermuda Triangle.
He made the comment after being asked why the company Chevron Australia Transport Pty Ltd was wholly owned by Chevron Australia Transport based in Bermuda.
The company’s general tax counsel, Sandy Macfarlane, confirmed more than 200 Chevron-linked companies had a presence in Bermuda.
Later, Uber public policy director Brad Kitschke was grilled why the fares of Australian passengers were ultimately paid to Uber head office in the Netherlands.
According to Mr Kitschke, the company sought out the Netherlands because “it has great talent”.
Not to be out-done, Airbnb country manager Sam McDonagh said Ireland was his company’s head office because of its “skilled workforce”.
The three firms, along with a string of other companies, are in the Senate spotlight over claims Australia’s tax base is being eroded by “creative” use of international tax systems by major multi-national firms.
Mr Krzywosinksi admitted Chevron had yet to pay tax on its huge investments in the Gorgon and Wheatstone LNG projects.
But once they were in operation, Australian governments would benefit from more than $300 billion in taxation and royalties revenue.
The defence from Mr Kitschke was not so strong, admitting that Uber Australia itself did not generate any revenue.
It is paid a fee by its Dutch headquarters which take 25 per cent of a driver’s fare.
Mr McDonagh said Airbnb paid an effective Australian company tax rate of 37 per cent.
But pressed on how much profit it had made, Mr McDonagh said that as Airbnb Australia was a private company, he could not reveal the details.
Labor Senator Sam Dastyari pointed out that for $37 he could purchase Airbnb Australia’s filings with the ASIC and learn the result.
The inquiry is continuing.