Singtel Group loses landmark tax case in Australia related to Optus acquisition

20 Dec 2021

Singtel Group has estimated that it faces AUD304 million (USD216 million) in tax exposure, interest and penalties following the dismissal of an appeal against an assessment by Australia’s Commissioner of Taxation. With the matter related to the acquisition financing of Optus back in 2001, Singtel’s Australian subsidiary – Singapore Telecom Australia Investments (STAI) – was reported to have received amended assessments from the Australian Taxation Office for primary tax of AUD268 million, interest of AUD58 million and penalties of AUD67 million in 2016 and 2017. Meanwhile, it was noted that STAI’s holding company, Singtel Australia Investment Ltd, would be entitled to a corresponding refund of withholding tax estimated at AUD89 million. Consequently, the net tax exposure and related interest and penalties amounted to AUD304 million.

In a statement regarding the matter, Singtel confirmed it has now received an ‘unfavourable judgement’ from the Federal Court of Australia of its appeal against the assessments. Commenting, the company said: ‘The Singtel Group will consider the details of the judgment, explore available options and determine next steps. If the above tax exposures are assessed to be probable, provisions shall be made in the accounts.’

Australia, Optus, Singtel Group