No thank you

Well TAFKAS never.  In today’s AFR, Tony Boyd writing as Chanticleer suggested that:

It would be smart for the national cabinet to follow the lead of tech entrepreneur Mike Cannon-Brookes, who views the global recession as an ideal opportunity to expand his business.

How do you say it …. HELL NO.

Now is certainly not the time for the National Cabinet to expand it’s business.

During the financial crisis Atlassian, in effect, offered one of its key software platforms used by business customers for free. Cannon-Brookes says this hit revenue in the short term but it underpinned a decade of expansion.

Yes.  Get’em liking your product, like welfare, and when they are hooked, milk it for “a decade of expansion“.  Yeah.  No again.

And another thing says Canon-Brookes:

We started hiring as much as we could in a weaker environment. As other people were letting staff go we were hiring.

Yeah.  No again.  Australian governments already employ 4 times the population of Tasmania.  No more no how.

Perhaps, rather than lionising the bearded oracle, he and his very profitable company be treated as similar pariahs as the other tech companies that minimise their tax in Australia.  In 2018:

Australian agile poster child Atlassian, which had a taxable income of $138 million on $1.04 billion in revenue.

But still paid NO tax:

Tech darling Atlassian paid zero tax in Australia despite drawing in more than $1bn in local revenue, after using research and development tax credits to offset $137m in taxable income.

The New York-listed software company was among the 21 per cent of 2000 large companies and multinationals operating in Australia that paid no tax during the 2017-18 financial year, according to the fifth annual report on corporate tax transparency, published by the Australian Taxation Office on Thursday.

Where is Emma Alberici?

It must be the beard and hat that confuses the journos.

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9 Responses to No thank you

  1. Tim Neilson

    Perhaps, rather than lionising the bearded oracle, he and his very profitable company be treated as similar pariahs as the other tech companies that minimise their tax in Australia.

    I assume, TAKFAS, that you’re saying that only in the subjunctive sense, without actually advocating that any non-taxpaying company should prima facie be treated as a pariah?

    If we’re stupid enough to permit a company with $137 million of local taxable income to pay no tax by using research and development tax credits, that’s hardly the company’s fault.

  2. stevem

    I’m all for them expanding their business. There is a whole new arm for them to explore – elimination of red & green tape. This is a huge untapped market they could dominate.

  3. 2dogs

    after using research and development tax credits to offset $137m in taxable income

    This is actually dodgy. There have been recent changes to R&D tax rules, so that it only applies to actual science being done. The days of software companies claiming the R&D tax credit for their entire team are supposed to be over.

    It seems Canon-Brookes is ignoring the new rules. How much science would a software company be doing?

    They do business workflow software. It’s not as if their software is controlling industrial processes.

  4. Squirrel

    Always fun to see the financial media spruiking for increased government spending (on things that their readers approve of) – and then spruiking for lower taxes (for their readers).

  5. How is Atlassian worth so much? Their software is painfully mediocre at best and there are and have been far superior alternatives out there.
    I wonder how much of their revenue comes from the PS?

  6. John A

    The New York-listed software company was among the 21 per cent of 2000 large companies and multinationals operating in Australia that paid no tax during the 2017-18 financial year, according to the fifth annual report on corporate tax transparency, published by the Australian Taxation Office on Thursday.

    Has anyone looked at their published accounts?

    For a software company that seems to be a fairly low rate of return on revenue.

    And what R&D did they engage in, which would have been eligible for such a large rebate?

    2dogs, if the rules changed recently, this report may still be valid as it refers to their 2017-18 tax year.

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