It is not only hi-tech internationals like Microsoft, Google and Apple that are rorting the tax system to minimise declared profits and therefore pay less tax.
Low-tech, state-owned native forest logging corporation, VicForests, has been at it for years. Since 2007 VicForests has posted total revenues of almost $1 billion raised from the sale of public wood-chips and timber.. Two-thirds of this is paid to a small number of loggers and hauliers and the balance is spent on running VicForests, including the CEO’s wage of over $300,000 per annum, about the same as the Premier’s.
The result is little or no profit realised and next to no tax payable. Total tax paid in the same period has been less than $2 million – 0.18% of revenues. Thus, the value vested in publicly-owned native forests is legally shifted into a relatively small number of private pockets.
The corporation is also supposed to pay a dividend to the state treasury, for access to publicly-owned forests. Like tax, this is based on profits with the result that in most years it is assessed at “$nil”. Dividends totalling $2.3 million, 0.24% of revenues, have been paid since 2007 for the privilege of logging the equivalent of 16,000 MCGs of public native forest.