Woolworths Holdings Limited (WHL) notes the publication of income tax reports for Financial Year 2014 on the Australian Taxation Office (ATO) website regarding its subsidiaries David Jones Pty. Limited (David Jones) and the Country Road Group Pty. Ltd (CRG).
David Jones was acquired by WHL on 1 August 2014, within the 2015 financial year. Prior to the WHL’s acquisition David Jones was a public company listed on the Australian Securities Exchange. WHL confirms that the income tax position for David Jones in Financial Year 2014, prior to WHL’s ownership, reflected an abnormal tax year with reduced profitability arising from poor trading conditions and a decline in financial services income in the period, as well as a tax deduction available under Australian tax law relating to the value of unsold and ageing inventory accumulated within the business. WHL notes that over the preceding financial years of 2011, 2012 and 2013, David Jones paid total income tax of $145 million at the corporate tax rate of 30%, representing an average effective tax rate of 29.16%. In the most recent financial year, FY2015, WHL expects David Jones to pay income tax of approximately $47 million on a taxable income of approximately $156 million. This represents an effective tax rate of 30.04%. While tax payable by David Jones will vary with the performance of the business in any given year, it is expected the effective rate of tax will be proximate to the corporate rate of 30% in future years.
Country Road Group
CRG became a wholly-owned subsidiary of WHL on 2 September 2014. Prior to WHL’s acquisition of minorities, CRG was a public company listed on the Australian Securities Exchange. As noted on the ATO website, in Financial Year 2014 CRG paid income tax of $23.6 million on taxable income of $87.8 million at an effective tax rate of 26.8%. In Financial Year 2015, WHL expects CRG to pay income tax of approximately $28 million on taxable income of approximately $107 million representing an effective rate of tax of 28%. These rates are lower than the standard rate due to Australian tax allowances claimed on significant research and development investment.
WHL welcomes the opportunity for further transparency provided by the ATO website. This will enable WHL and other corporate tax payers to demonstrate compliance with Australia’s tax regime, and clearly disclose the variability in tax paid from year to year relative to the performance of its business. WHL is committed to making a strong economic and social contribution to the Australian community through the David Jones and CRG businesses. WHL has established its own risk and tax governance framework to oversee its compliance with Australian taxation obligations.
For media enquiries contact: Press Office Angus Urquhart T: +61 3 9600 1979 M: +61 402 575 684
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