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Microsoft Corp.

Tech Giants Defend Tax Arrangements in Australian Senate Committee Hearing

Strategic Insights

— 1 min read

Representatives from Google, Apple, and Microsoft appeared before an Australian Senate committee on Wednesday, facing scrutiny over their tax arrangements in the country. The companies' executives, Tony King, Maile Carnegie, and Bill Sample respectively, emphasized their commitment to complying with Australian tax laws, while also highlighting the benefits their businesses bring to the country through jobs, investments, and innovation. The hearing shed light on the complexities of the companies' tax structures, with Google's Maile Carnegie acknowledging that the company bills ads taken out by Australian firms to Singapore, a move that has sparked controversy over tax avoidance.

Key Takeaways:

  • Apple's Tony King stated that all of the company's revenue and sales are reported locally, and Apple pays all of its taxes on sales in Australia.
  • Google's Maile Carnegie acknowledged that the company bills ads taken out by Australian firms to Singapore, which has a lower corporate tax rate than Australia, but emphasized that Google is structured to be competitive, not based on tax.
  • Microsoft's Bill Sample revealed that $2 billion worth of software sales generated in Australia is billed to Singapore.
  • Apple Australia is owned by Apple Ireland, which has a relatively low corporate tax rate.
  • Apple had a turnover of $6 billion in Australia last year and paid $80 million in tax.
  • Maile Carnegie compared Google's business to a mining company that has many customers in China but pays only a small amount of tax there.
  • Tony King was unable to say how much of the money paid by Australian consumers buying Apple products went offshore.
  • The representatives from the tech giants emphasized their commitment to complying with Australian tax laws and the benefits their businesses bring to the country.

Statistics:

  • $6 billion: Apple's turnover in Australia last year.
  • $80 million: Apple's tax payments in Australia last year.
  • $2 billion: Value of Microsoft's software sales generated in Australia that is billed to Singapore.
  • SIGP: Singapore, which has a lower corporate tax rate than Australia.

Sources:

  • Senate committee hearing transcript, Wednesday.
  • Photo caption by Christopher Pearce.

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