CBA reaps tax haven rewards
(17 November 2009 – Australia) The Commonwealth Bank’s operations in Malta generates a A$55 million benefit for the group due to low off-shore tax rates.
The Australian Taxation Office (AFO) no longer regards the Mediterranean island nation of Malta a tax haven despite it being blacklisted in a proposed US legislation earlier in the year and Malta has been pronounced technically sound by the ATO.
The Commonwealth Bank has a holding company called Newport, which has a A$5 million balance sheet.
Newport owns CommBank Europe, which has six staff members including Newport and Commbank director, Chris Millet, who is also the bank’s head of tax.
Ralph Norris, chief executive officer, CBA, said that Malta is a bona fide country of operations into Europe.
The bank has a very significant amount of lending into infrastructure and the like in Europe, and because it is euro-denominated and funded, the bank could not operate out of London, Mr Norris added.
Mr Norris highlighted that Malta certainly does have a lower tax rate, but so do places like Hong Kong, Singapore and the like, and also the offshore banking unit here in Australia.
The tax efficiency of the structure is revealed in CBA's 2009 annual report, which shows a A$55million benefit from overseas tax rate differences, up from A$35milion for the year before.
The Commonwealth Bank has a holding company called Newport, which has a A$5 million balance sheet.
Newport owns CommBank Europe, which has six staff members including Newport and Commbank director, Chris Millet, who is also the bank’s head of tax.
Ralph Norris, chief executive officer, CBA, said that Malta is a bona fide country of operations into Europe.
The bank has a very significant amount of lending into infrastructure and the like in Europe, and because it is euro-denominated and funded, the bank could not operate out of London, Mr Norris added.
Mr Norris highlighted that Malta certainly does have a lower tax rate, but so do places like Hong Kong, Singapore and the like, and also the offshore banking unit here in Australia.
The tax efficiency of the structure is revealed in CBA's 2009 annual report, which shows a A$55million benefit from overseas tax rate differences, up from A$35milion for the year before.
Subscribe