Netflix earned hundreds of millions of dollars from Australian customers in 2021. But its tax bill was small compared to its revenue.
Netflix paid less than $1 million in taxes in 2021 despite earning hundreds of millions from Australian customers.
According to documents filed with the Australian Securities & Investments Commission (ASIC), as revealed by The Sydney Morning Herald, Netflix’s local tax bill was $868,000. It reported a profit of $1.5 million on revenue of $30.7 million, related to back-end operations such as payment processing.
Netflix’s real revenue push – revenue from customer subscriptions – was not subject to Australian taxes as local subscribers were billed through a Netherlands-based entity.
The Netherlands is a low-tax jurisdiction and Netflix’s accounting actions are legal. SMH mentioned netflix intended to bill Australian customers via Australia from January 2022.
Although Netflix does not reveal region-specific subscriber numbers outside of North America, industry analyst Telsyte estimated that Netflix has six million members in Australia.
With the cheapest Australian subscription at $10.99 per month and capping at $22.99 per month, six million accounts would translate to revenue of between $791 million and $1.65 billion.
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Netflix has ramped up local orders since its first Australian title, the widely streamed supernatural drama Tideswhich starred Elsa Pataky, in May 2017.
The streamer has since released a controversial reality series Byron Baeswhich angered locals over fears of how the popular vacation town would be portrayed, Chris Lilley’s foolsanimated feature film Back to the hinterland and documentary Puff: wonders of the reef.
He has in the works a Raised from heartache reboot, the comedy-drama starring Celeste Barber Wellmania and the Jessica Watson biopic True Spirit.
Australia also hosted a series of Netflix titles that were co-productions with the United States.
There was the thriller series Clickbaitwhich was filmed in Melbourne but featured an American story and an American cast.
Coming soon is the action feature directed by Elsa Pataky Interceptordirected by Australian writer Matthew Reilly who adapted his own book, although it is heard Interceptor was ordered to the American team.
Melissa McCarthy Series God’s Favorite Idiot filmed the first episodes in northern New South Wales before production unexpectedly ended early. The remaining episodes are expected to be filmed later in the United States.
Netflix and other international broadcasters, including Amazon Prime Video and Disney+, have actively invested in Australian productions while trying to avoid government intervention in the market.
Local production interests and artists have argued for a mandatory quota so that international entertainment companies are required to invest a certain percentage of their revenue in Australian television and film production.
Globally, Netflix has had a tumultuous few months with its stock price fall 70% since the start of the year, wiping tens of billions of dollars from its value.
The company revealed in April that it had released a net loss of 200,000 subscribers in the first three months of the year, and is expected to lose another 2.5 million in the current quarter. The news led to a sell-off of its shares as investors worried about the company’s long-term growth trajectory.
As a result, Netflix executives have pledged to make drastic changes to its operating model.
Netflix said it would introduce a cheaper, ad-supported membership tier by the end of the year and crack down on password sharing.
It also began cutting costs, including laying off the head of its animation department as well as several staff and projects, including the Meghan Markle series. pearl.
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