More than 1,100 large companies paid no Australian corporate income tax in the 2024-25 financial year, according to the latest Australian Taxation Office transparency data.
The figures show that 1,149 of 4,299 large corporate entities reported no income tax payable during the year, although the ATO stresses that a zero tax bill does not necessarily indicate tax avoidance.
Companies can legitimately pay no tax because of previous losses, investment deductions, depreciation, restructuring costs or other provisions within Australia’s corporate tax system.
Nevertheless, the scale of the numbers is likely to intensify scrutiny of how large multinational businesses structure their Australian operations.
AI and data centres draw attention
One emerging area of interest for the ATO is the rapidly expanding artificial intelligence and data centre sector.
Billions of dollars are being invested in Australian computing infrastructure as global technology companies race to secure capacity for AI models and cloud services.
The ATO is examining financing structures, intellectual property arrangements and payments between Australian operations and offshore related entities.
Data centres are particularly capital intensive, meaning large depreciation charges and debt-servicing costs can substantially reduce taxable profits during periods of rapid expansion.
The tax office has increasingly focused on multinational profit shifting and arrangements that transfer income to lower-tax jurisdictions.
Australia’s corporate transparency regime covers large Australian and foreign-owned companies above specified income thresholds.
With AI investment accelerating rapidly, the sector is likely to become an increasingly important part of the broader debate over how much economic value generated from Australia’s infrastructure should ultimately remain taxable in Australia.
