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  • Demographics of large corporate groups

    Large corporate groups make a significant contribution to the Australian economy and play a critical role in the tax system. They're important in creating community confidence in our tax system. Confidence is gained directly by their tax contribution, and indirectly because their compliance underpins willing participation in other taxpayer segments.

    Definition of a large corporate group

    We define a large corporate group as one with a group turnover greater than $250 million. There are approximately 1,720 large corporate groups with nearly 7,000 income tax reporting entities in Australia. This represents over 331,000 active companies. These groups include Australian public, Australian private and majority foreign-owned businesses.

    Large corporate groups – ownership, 2019–20

    This chart shows the large corporate groups ownership for 2019-20. Of the 1,720 corporate groups 33% (570) are Australian owned by private companies; 23% (400) are Australian owned by public companies; and 44% (750) are majority foreign owned.

     

    Large corporate groups – total business income, 2019–20

     This chart shows the total business income for large corporate groups for 2019–20. Of the $2.1 trillion total business income 40% ($856b) are majority foreign-owned; 10% ($206b) are Australian owned private companies; and 50% ($1,063b) are Australian owned by public companies.

    Large corporate groups – total profits, 2019–20

     This chart shows the total profits for large corporate groups in 2019–20. Of the $210 billion total profits 25% ($52b) are majority foreign-owned; 6% ($12b) are Australian owned private companies; and 70% (146b) are Australian owned public companies.

    How much tax large corporate groups pay

    The amount of tax payable by large corporate groups has fluctuated over time. This generally reflects changes in economic conditions that impact on the largest taxpayers, in particular, fluctuations in the Australian dollar (AUD) price of commodities such as iron ore. This can be seen in the tax paid by diversified miners and other energy and resources groups.

    Large corporate groups – contribution to tax revenue, 2013–14 to 2019–20

     This graph shows the contribution to tax revenue from 2013-14 to 2019-20 for large corporate groups.

    The number of large corporate groups in the Australian tax system is comparatively small, yet the impact they have on revenue is significant.

    Large corporate groups – contribution to tax revenue, 2019–20

     In 2019-20 there were 1,720 large corporate groups, each with a turnover above $250 million who collectively generated $2.1 trillion in total business income and $57.0 billion of the $88 billion in corporate income tax reported.

     

     The tax contribution from these 1,720 large corporate groups is equivalent to around 65% of all corporate income tax reported and 13% of total ATO tax collections.


    The largest corporate groups contribute a significant proportion to overall corporate income tax collections.

    Large corporate groups – concentration of tax contribution, 2019–20

     The largest 10 corporate groups reported $26.2 billion or 30% of all corporate income tax reported.

     The largest 100 corporate groups reported $44.1 billion or 50% of all corporate income tax reported.

    While Australian public businesses only make up 23% of these 1,720 large corporate groups, they pay 68% of the corporate income tax payable, as against 50% of the gross income, for this group. This is driven by the significant profits earned by a relatively small number of very large Australian-owned groups. Once these companies are excluded, the overall performance of other Australian public companies, private companies and majority foreign-owned companies are relatively similar.

    Large corporate groups – ownership and tax contribution, 2019–20

     This graph shows the ownership and tax contribution of large corporate groups in 2019–20. Of the $57.0 billion tax reported 26% ($15b) are majority foreign-owned; 6% ($4b) are Australian owned private companies; and 68% ($38b) are Australian owned public companies.

    Large corporate groups are involved in a diverse range of sectors across the economy. Those in the Banking, Finance and Investment, and Mining, Energy and Water industries number less than one-quarter (23%) of all large corporate groups, earn one-third (35%) of business income but contribute more than two-thirds (68%) of large corporate income tax.

    Large corporate groups – industry demographics (number), 2019–20

     This graph shows the industry demographics for large corporate groups in 2019–20. Of the 1,720 corporate groups 52% are wholesale, retail and services; 3% are insurance; 9% are mining, energy and water; 14% are banking, finance and investment; and 23% are manufacturing, construction and agriculture.

    Large corporate groups – industry demographics (business income), 2019–20

     This graph shows the industry demographics (business income) of large corporate groups for 2019–20. Of the $2.1 trillion total business income 43% are wholesale, retail and services; 16% are manufacturing, construction and agriculture; 6% are insurance; 13% are banking, finance and investment; and 22% are mining, energy and water.

    Large corporate groups – industry demographics (tax reported), 2019–20

     This graph shows the industry demographics (tax reported) of large corporate groups for 2019–20. Of the $56.6 billion tax reported 22% came from wholesale, retail and services; 7% from manufacturing, construction and agriculture; 3% from insurance; 24% from banking, finance and investment; and 44% from mining, energy and water.

    Last modified: 10 Dec 2021QC 53277