On 13 December 2018 the Australian Tax Office published a report containing tax information for more than 2000 corporate tax entities for the 2016-17 year.
The report shows EnergyAustralia had total revenue of $6.3 billion and no taxable income during the 2016 financial year. Subsequently, EnergyAustralia began paying corporate tax in October 2017 and has continued to do so every month since.
Chief Financial Officer Alastair McKeown said EnergyAustralia paid $68.5 million corporate tax in respect of its 2017 financial results, reflecting the benefit of a program begun in 2014 to improve operational performance.
“For the past decade an excess of electricity supply in a highly competitive market has led to very modest, and sometimes negative overall returns for EnergyAustralia,” Mr McKeown said. “In recent years that has meant low – or no –profitability, and no corporate tax payable.”
From 2006 to 2014 EnergyAustralia lost in aggregate around $200 million and had to write-off some $1.9 billion from the value of its assets.
“In 2014 we began a program to restore value to the business, including the appointment of new senior management, cost reductions and investments to enhance customer service and the efficiency of our generation assets. Lately, firmer wholesale electricity markets have underpinned our results,” Mr McKeown said.
“The business has applied its accumulated tax losses and, today, is consistently profitable. As EnergyAustralia’s performance continues to improve, our contribution to the community will follow, including the corporate tax we pay,” he said.
Based on EnergyAustralia’s size and income, it is classified a ‘key taxpayer’ by the ATO. This means EnergyAustralia works closely with the ATO on tax affairs to ensure the business is paying all the tax it is required to.
In fact, EnergyAustralia was the first energy utility in Australia to register for the government’s Voluntary Tax Transparency Code. EnergyAustralia’s 2018 Tax Contribution Report is available here.
Corporate tax is just one way in which a business contributes to the community. For example, EnergyAustralia paid close to $15.5 million in payroll tax for the 2017 financial year. Also, the company employs around 2,500 people in Australia, providing income tax revenue, and does business with hundreds of service providers around the country.
EnergyAustralia outlays more than $700 million each year on goods and services – more than 97 per cent of which is spent in Australia. But most important, EnergyAustralia provides reliable, affordable energy for customers, while leading the transition to a cleaner, modern energy system.