Qantas rubbishes ‘nonsense’ notion it shouldn’t push tax cuts

Qantas has insisted it’s “nonsense” to suggest it shouldn’t push for tax cuts because it hasn’t paid corporate tax in years.

A Qantas A380 makes it way to the runway for takeoff at Melbourne Airport. (Picture: Nicole Garmston)

Qantas has insisted that it’s “nonsense” to suggest it shouldn’t push the case for corporate tax cuts simply because it hasn’t paid it for years.

“The notion that Qantas shouldn’t argue in favour of company tax cuts because of its financial losses and resulting tax status is nonsense,” the airline giant said in a statement this afternoon.

“And it ignores the benefit to the broader economy that lower tax rates will bring.”

The comments came in a response to reporting by the ABC on company tax that noted Qantas hasn’t paid company tax for close to 10 years and that Alan Joyce is a vocal supporter of the Turnbull government’s push to cut the rate of business tax.

The government’s plans to cut the corporate tax rate to 25 per cent for all business faces the prospect of being blocked in the Senate as Labor and the Greens oppose it, while One Nation and Nick Xenophon Team senators have indicated they will too.

Labor’s assistant Treasury spokesman Andrew Leigh seized on the report, saying the Turnbull government “needs to fall in love with ordinary Australians rather than protecting large multinational corporations and millionaires”. But Prime Minister Malcolm Turnbull hit back at the ABC analysis.

The airline (QAN) also insisted that competitive tax rates were “key” for a company whose “ability to keep growing jobs and investing in our people depends on the health of the Australian economy”.

Under Australia’s tax system, losses from previous years can be carried forward against the taxable income of a company.

In its statement, Qantas said it still had to “work through” about $950 million of tax losses but “we expect to return to paying company tax soon”.

It also noted that its profits had generated taxable income through unfranked dividends paid to shareholders since 2016 and through taxes on transactions by the group such as the GST, payroll tax and fringe benefits tax.

Qantas is due to report its half-year results next week.

In 2014 Qantas revealed a $2.8 billion full year loss.

But a turnaround strategy, that included cost cuts saw it return to profit the following year.

additional reporting: AAP