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Old 03-09-2004, 13:20   #1 (permalink)
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Question Toyota & the Tax Man

Toyota Motor's Australian unit on Tuesday said that authorities are conducting a review of its tax payments between 1994 and 1999, but dismissed a media report it faces a tax bill of up to $A1 billion.

While noting the company is co-operating with the Australian Tax Office, Toyota Australia spokesman Peter Griffin reportedly said the company has met all its tax obligations and that the review is standard for multinational companies.

The ATO review "is not unusual, this is standard practice," Griffin told Dow Jones Newswires, adding: "In our view, we have been doing everything according to the regulations," and stating there is currently no dispute with the tax authority.

He also reportedly rejected suggestions the Japanese company may cut jobs from its 4,700-strong local work force or scale back its Australian operations because of the tax bill.

"There is no link between a review of the taxation position and our jobs anywhere in Toyota Australia," Griffin told Dow Jones, adding: "These jobs are safe and the business is looking to grow in Australia."

According to Dow Jones, the Herald Sun newspaper in Melbourne said that the ATO is investigating Toyota Australia for shifting profits outside the country to avoid high taxes.

Citing the ATO, the report said the so-called ‘transfer pricing scheme’ has cut Toyota's tax bill by between $A400 million and $A1 billion, Dow Jones added.

"The review is still under way, so I'm not sure where that number came from," Griffin told the news agency.

Dow Jones said transfer pricing is a business practice where goods are sold or services moved between subsidiaries to minimise profits in high-tax countries such as Australia.

"It is allowed by the ATO provided you follow regulations," Griffin reportedly said.

According to Dow Jones, he didn't know when the review would be completed and the tax office declined to comment.

Toyota's Australian operation is a major manufacturer and exporter of the Camry sedan model line. Export markets include the Far East.

http://just-auto.com/news_detail.asp?art=43764&dm=yes
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Old 03-09-2004, 14:21   #2 (permalink)
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Re: Toyota & the Tax Man

All the big companies use transfer pricing to minimise local tax.
It becomes a bit of a game, move the money around the world so fast that nobody can make sense of where it all belongs, came from, or is going to end up.
You could be sure that some of the transfer pricing for parts from Japan is higher than the retail price of the spare parts.
Result: A local loss for tax purposes, an improved result overseas for the principal.
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Old 03-09-2004, 15:35   #3 (permalink)
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Re: Toyota & the Tax Man

Just a tax audit and media speculation.
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Old 03-09-2004, 16:56   #4 (permalink)
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Re: Toyota & the Tax Man

I used to work for a particular copier manufacturer and was given the task of locally sourcing all of the bearings used in copiers - I found one particular bearing - about 5mm in diameter that i could get locally for about 30c wholesale but we were paying $800 dollars to japan for them each.

When I raised this point I was told not to continue to try and locally source bearings.

It appears that this is how a lot of money was being funneled back to Tokyo. Thru spare parts - for years after I would occasionally stumble on a seemingly innocent part at some ridiculous price.
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Old 03-10-2004, 11:18   #5 (permalink)
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Re: Toyota & the Tax Man

Heh, it nots a bad idea in something like a photocopier (or a car ), give some innocent part a complicated name, and a big price tag . . who's going to know or question it ? :)
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Old 01-16-2006, 22:22   #6 (permalink)
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Re: Toyota & the Tax Man

Toyota Australia has been the beneficiary of hundreds of millions of dollars in Australian taxpayer manufacturing subsities and it would be very dissappointing indeed if they are found guilty of evading up to $1 billion tax to Australia.

Seven years ago, Mr John Conomos, Senior Vice-President of Toyota Australia,was quoted as saying that Australian importers of
secondhand Japanese vehicles were no better than drug dealers. Perhaps
if Toyota is found guilty of this mammoth amount of evaded tax , some Australians who will use similar colourful language to describe Toyota.

Multinational companies who are manufacturing guests in Australia ought to
abide by Australian law including our tax laws and in return the Australian consumer will treat them fairly and honourably despite the historical past.
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Old 01-17-2006, 01:29   #7 (permalink)
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Re: Toyota & the Tax Man

Quote:
Originally Posted by AU1XR8
I used to work for a particular copier manufacturer and was given the task of locally sourcing all of the bearings used in copiers - I found one particular bearing - about 5mm in diameter that i could get locally for about 30c wholesale but we were paying $800 dollars to japan for them each.

When I raised this point I was told not to continue to try and locally source bearings.

It appears that this is how a lot of money was being funneled back to Tokyo. Thru spare parts - for years after I would occasionally stumble on a seemingly innocent part at some ridiculous price.
maybe that helps to explain how a single passengers side electric window swich fo a TS magna can cost $1437.
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Old 01-17-2006, 02:05   #8 (permalink)
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Re: Toyota & the Tax Man

Its funny that guys name is Peter Griffin, anyone who watches Family Guy will know what i'm talking about.
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Old 03-12-2006, 16:39   #9 (permalink)
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Re: Toyota & the Tax Man

Toyota settled a claim of over $35 million arising from a charge of attempting to restrict trade between Canada motor dealers and USA buyers contrary to AFTA. This mattter was reported in detail by the Australian Financial Review
03-06.
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