The New Daily and Michael West count down the 10 biggest corporate tax dodgers in Australia. Return on Friday when we reveal the nation’s 4th-biggest tax avoider.
Imagine getting more than $30 million in government grants in a year after paying no tax over five years – and taking in $15 billion cash.
That’s what Vodafone has achieved, joining Rupert Murdoch’s Foxtel and the financial engineers from Brookfield on our list of companies that get government grants and pay no tax.
That’s as long as they can get the pre-tax profits offshore to related parties. The Cayman Islands has a corporate tax rate of zero.
Vodafone gets its pre-tax profits out of the country via “service agreements”, loan guarantees, swaps and “debt-loading”, that is, the reliable practice of a foreign entity lending money to the Australian subsidiary. The interest on these loans heads offshore before tax.