Energy giant ExxonMobil has not paid a cent in corporate income tax in Australia in at least two years, despite reaping more than $18 billion from the nation’s natural resources, according to three of the company’s workplace unions.
Tax campaigners accuse the company of cashing in on Australia’s soaring gas prices, but avoiding paying tax on its profits by sending much of its money to a network of offshore companies, some based in notorious tax havens.
The company dismissed the unions’ claims as “misinformation” and said it paid state and federal royalties on its Australian operations as well as petroleum resource rent tax and corporate tax.
But in Victoria, where ExxonMobil runs the giant Esso Longford gas plant supplying much of the east coast market, the state government wants an investigation, saying Australians expect a fair return from companies profiting from the nation’s natural resources.
Three unions fighting a bitter industrial dispute with the energy giant launched a campaign in Canberra on Monday for the Commonwealth to investigate Exxon’s tax affairs.
The Electrical Trades Union, the Australian Manufacturing Workers’ Union and the Australian Workers Union recruited the Tax Justice Network (TJN) to examine Exxon’s tax affairs and say the network has uncovered tax avoidance on a massive scale.
The TJN says Exxon is more aggressive in minimising its tax than Chevron, which agreed to a settlement believed to be worth more than $1 billion this year, after being taken to court by the Australian Taxation Office.
Exxon is the latest large corporate player to be revealed using “related party loans” to its overseas entities to minimise or avoid Australian taxes, the unions and the TJN allege.
The network says it has uncovered a bewildering array of least 575 Exxon-linked companies incorporated in the Bahamas, one of the tax havens recently exposed in the “Paradise Papers” scandal, including at least three with direct links to Australia.
TJN spokesman Jason Ward says Exxon has up to $54 billion “stashed” offshore.
“Exxon could very well prove to be more aggressive than Chevron,” Mr Ward said on Sunday.
“The initial research shows Exxon is just as brazen about bending the rules to the point of being ridiculous and even less transparent.
“These natural resources belong to the Australian people and we should be getting more.
“Exxon hasn’t paid any corporate tax in two years, while reporting $18 billion in revenue.
“Now we know how they did it; by using notorious tax havens such as the Netherlands and the Bahamas, high-interest loans and other related party transactions.”
The tax avoidance claims mark an escalation in the industrial dispute at Longford in Gippsland where 230 employees have been battling the company for six months over a new workplace agreement that unions say slashes wages and conditions.
The union will bus workers and their families to federal Parliament on Monday to pressure MPs and senators for a full investigation of Exxon’s record of paying taxes in Australia.
But the company said on Sunday that the unions were engaged in a campaign of misinformation.
“ExxonMobil Australia’s entities have made a significant contribution to the Australian economy through the reliable supply of energy to fuel economic growth, as well as through direct tax and royalty payments to state and federal governments,” a spokesman said.
“Esso has paid more than $12 billion in Petroleum Resources Rent Tax to the federal government.
“When combined with corporate income tax during the past decade, this equates to more than 50 cents in the dollar tax paid.”
The company says it is not a party to the ongoing dispute in Victoria, which it says is between its contractor UGL and the unions.
Victorian Treasurer Tim Pallas said on Sunday that allegations of tax avoidance needed to be fully investigated.
“Victorians and Australians alike deserve fair compensation for our resources, in particular those that are exported overseas,” Mr Pallas said.
“Any allegations of tax avoidance should be fully investigated.” (Taken from The Sydney Morning Herald)
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