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Household company avoids more than $100m worth of Australian tax

Household company avoids more than $100m worth of Australian tax

CANBERRA: A multinational company that owns household name products found in virtually all Australian homes has been named and shamed for avoiding $138 million worth of tax. Reckitt Benckiser (now known as RB), which sells a range of brand names including Vanish, Dettol, Nurofen, Clearasil and Durex, made the Netherlands its regional hub for Australia, as part of a restructure three years ago. The company is exempt from paying tax on 75 percent of profits in the Netherlands, meaning the effective tax rate works out as a low 7 percent.

The ‘Making Tax Vanish’ report published by Oxfam today, exposes flaws in the Australian tax system that allows multinational companies like RB to systematically avoid paying a large amount of the tax that Australian companies have to pay. “I think ordinary Australians are increasingly impatient with multinational companies and their practices,” Oxfam CEO Dr Helen Szoke said. “We see many multinational like RB that have products that are very familiar to us – products like Vanish and Nurofen. Given we are buying those products, we are supporting their profits and their bottom line, we would have an expectation that they should be paying tax. The report comes as the Australian government toughens laws on corporate tax avoidance as part of its “Earned here, Taxed here” crackdown. The Labor party has pledged go further, introducing public country-by-country reporting for corporations with more than $1 billion in global revenue.