Our contribution to AustraliaOur digitalization and automation technology is used to help local manufacturers be more competitive and support them on the journey to the fourth industrial revolution (Industry 4.0). Our building and rail technologies provide intelligent infrastructure for our cities and resource industries who need to optimise assets and infrastructure performance to make our cities more liveable, attractive and productive.
In fiscal year 2017, of a total income of approx. $1.47 billion, our taxable/net income was approx. $102 million, and income tax payable was $28.6 million. With a diverse technology offering across many sectors, our income is heavily affected by major project income.
Siemens’ total taxation expenditure in Australia in fiscal year 2017 was about $220 million which includes a variety of taxes such as income tax, GST, FBT, Customs, payroll tax, PAYG withholding tax and stamp duty. For fiscal year 2017, the Siemens tax group had an effective tax rate of 22% (tax paid as a percentage of taxable income) as a result of eligible R&D investment and participation in PPP (Public Private Partnership) infrastructure investments.
Overall, Siemens operations are linked to a GDP contribution of about $3.7bn. From 2012 to 2016, Siemens contributed ~$1bn of finance to local businesses and public infrastructure. In the same period, Siemens invested ~$30 million in new Siemens’ hi-tech service centres.
These reported figures include offsets for major public private partnerships into hospitals and a variety of R&D investments.
We are committed to providing transparent and accessible information to tax administrations in order to facilitate an understanding of our tax strategy and the underlying business models. We promote an open and honest dialogue between tax policy makers and businesses as the basis for our daily work.
We employ approximately 2,000 people across Australia in major sites such as our head office in Bayswater (Melbourne) and other state offices in Adelaide, Sydney, Brisbane and Perth. In addition we have smaller manufacturing and service centres for the mining, energy, oil and gas and rail industries as well as people working directly on customer sites including remote regions.
In addition, through some of our major projects, Siemens is the turn-key provider and therefore we also employ hundreds of people via third parties such as our civil contractors. In fact, Siemens enables 29,000 jobs in Australia and our operations are linked to a GDP contribution of approximately $3.7 billion.
Investing in new facilities
Siemens has recently invested in a number of new hi-tech service facilities in Australia. This includes service centres in Rockhampton, Perth Airport and the Tonsley technology precinct near Adelaide – all supporting local communities, governments and industries. Siemens also announced $4.8 million investment into a national rail signalling centre in Queensland in 2017 and about $25 million investment into a new Queensland facility to help increase local manufacturing and export.
These substantial investments demonstrate our commitment to Australian industry – especially as it transitions from a major capital expenditure program in mining and resources into an operational phase where hi-tech service support becomes critical to maintain productive operations and improved efficiencies.
Public Private Partnerships – supporting hospital developments
Our PPPs such as Sunshine and Bendigo hospitals form part of almost $1 billion financing investment into Australia. This means heavy upfront costs and offsets (similar to say a mining project where returns come later). By being a PPP, Siemens is supporting critical infrastructure development especially for the healthcare sector. This investment helps provide state-of-the-art health provision as well as economic stimulus and jobs for many local workers employed in the construction of the hospitals, as well as the ongoing operation of the hospitals.
A PPP project with high financing costs involves loss making in early years and return to be derived in later years following completion of construction. The book income relates to the deemed interest income on financial assets which is not taxable.
Helping Australia prepare for Industry 4.0
Siemens actively supports local industry, governments and stakeholders to understand and prepare for key economic and societal changes such as the fourth industrial revolution (Industry 4.0), the transition to "intelligent infrastructure" and a "sustainable energy" future.
Three significant recent initiatives towards this regards are:
- The establishment of the Prime Minister’s Industry 4.0 Taskforce with Siemens CEO and Chairman Jeff Connolly at the lead (2016).
- Through over A$1 billion of in-kind commercial value grants of advanced manufacturing software to universities across the country.
- Partnering with the Australian Industry Group (AiG) and Swinburne University to establish the country's first Industry 4.0 Apprenticeship as a unique program that has won multiple global and local awards.