Corporate Culture: Tax Loopholes Mock "Heavy Lifting"

UNITED VOICE  29 MAY 2014
Westfield: corporate tax case study

As Australians face a budget of unprecedented harshness and cutbacks, United Voice, one of Australia’s biggest unions, today released research which exposes the low tax rates paid by retail giant Westfield.

As an annual average, Westfield’s effective corporate tax rates in the nine years to 31 December 2013 were:

• 8% for the Westfield Group
• 0% for the Westfield Retail Trust

This falls far short of the 22% estimated average effective tax rate for all ASX200 companies over the past decade. Westfield is Australia’s most profitable real estate corporation and the world’s largest shopping centre owner.

David O’Byrne, Acting National Secretary of United Voice, says “This research reveals that when it comes to heavy lifting on tax, Westfield is missing in action.

“Tax avoidance may not be illegal, but we believe it is immoral and never more than today when low income earners are facing a budget of across-the-board cutbacks. While some corporations are paying their tax, there are others who simply look to exploit any loophole they can.

“Given the huge amount of tax revenue involved, this needs to be an urgent priority of the Abbott Government.

“If Westfield had paid tax at the statutory rate of 30% it could generate additional annual tax revenues of $541 million:

• $370 million on average pre-tax profits of $1.7 billion for the Westfield Group
• $171 million on average pre-tax profits of $574 million for the Westfield Retail Trust

“The Government could do a lot with an extra $541 million every year. For example, it would more than cover the Government’s $1.8 billion in cutbacks to hospitals funding over the forward estimates.

“The Government must get it priorities right. It cannot allow this wholesale corporate tax avoidance to continue.

“Rather than making life even more difficult for low and middle income earners, the Government should ensure corporate Australia fulfils its responsibilities.

“It is time for a major enquiry by the Federal Government to investigate:

• reforming Australia’s corporate tax structure
• closing the tax loopholes, such as stapled securities and tax havens
• increasing transparency and disclosure by corporations

“The Prime Minister and Treasurer have talked tough about corporate tax dodgers. Now it’s time to act,” says David O’Byrne.