Rich list accounts still free from public scrutiny

More than 1100 companies – including those controlled by some of the most influential families and rich listers – remain exempt from lodging accounts with the regulator, 25 years after the temporary exemption was granted.

So-called "grandfathered large proprietary companies" were exempted from some reporting requirements as part of provisions put in place by the Keating government in 1995.

Designed as a temporary arrangement, 1500 firms were included on the original list but a recent update reveals the list still includes companies linked to billionaire rich listers Anthony Pratt, Kerry Stokes and Bruce Gordon, along with firms controlled by the Myer family, transport magnate Lindsay Fox, and private hospital giant Ramsay Health Care.

Released by corporate watchdog the Australian Securities and Investments Commission, the updated list shows 1119 firms remain exempt, including entities linked to Transfield, Tobin Brothers, Bob Jane, Jones Lang LaSalle, Sealey, Inghams and Dymocks.

Billionaire investor Alex Waislitz's Thorney Pty Ltd is on the list, along with leading hedge fund Portland House Group, owned by billionaire David Hains.

Deregistered firms and those reporting under the Corporations Act are removed from the list. Some small firms are included and all are required to comply with Australian law.

In 2018, then prime minister Malcolm Turnbull asked for his company, Turnbull & Partners, to be removed. ASIC has told crossbench senator Rex Patrick this month it has "no power" to remove firms, even at the request of a company.

Under the rules, a grandfathered large proprietary company is exempted because it was not required to lodge information before changes to the Corporations Act in 1995.

Then the test for lodgement was ownership-based, rather than based on current economic significance and size. No new companies can be added.

The list was expected to be temporary and reviewed a few years after it was established. That move was stopped by the Howard government. More recently the Greens and Labor have supported moves to abolish the list.

On the latest update are 12 companies which lodge financial reports under Tax Office significant global entity rules. Some data for the firms, including 7-Eleven Holdings, Suttons Investments and Baiada companies, is made public.

ASIC told Parliament in 2015 the lack of availability of public financial reports for the companies "reduces transparency about possible indicators of tax avoidance or tax minimisation".

It recommended grandfathered large companies be removed from the Corporations Act and firms be required to lodge financial reports to reduce "any inequity with similar companies".

Companies on the list which are still operating with annual turnovers of more than $100 million faced losing their exemptions when laws passed by the Rudd-Gillard government would have required the Commissioner of Taxation to publish their tax information.

But the Coalition passed laws to exempt private companies over fears directors could face kidnapping or commercial disadvantage from their information being public.

ASIC commissioner John Price told a Senate estimates hearing in March any move to abolish the list was a question for the Parliament and the Morrison government.

This week Senator Patrick said the exemptions undermined broader tax transparency efforts across the federal government.

He is calling for the list to be abolished now, part of an aggressive campaign on transparency measures.

"If the government took tax avoidance seriously they would have dealt with this issue a long time ago,” Senator Patrick told The Australian Financial Review.

"It involves some rich and powerful families but it is a hole in the oversight system. I want ASIC to do their job properly but they can't do that if they're not fully informed."