- May 7, 2011
- Reaction score
I'm always a bit hit and miss with this.204 Australian companies who have generated $800 billion dollars over the last 5 years and have paid no tax.
I understand that these companies are doing dodgy stuff, but most of this "they don't pay tax" is usually a misinformation thing. It's similar to the complaints about churches not paying tax.
You only pay tax on profits, not revenue. That means if your business makes $1 million but outs $1 million back in the business, then you pay no tax on that $1 million 'cause it's not a profit but a business expense. There is a reason for there being no tax on it. It's part of economic growth. Tax before it goes back into the company then the company operates at a loss which means the money going to the government doesn't go to the employees. It reduces growth and employment. A common misconception people have about the elite companies is that the stockholders, owners and CEOs are sleeping on huge piles of money. More often the money is reinvested.
That said, there are companies who make profits in Australia then right the tax off through dodgy works.