Tom Adams

Alcoa’s Pinjarra aluminium refinery, Western Australia

Michael D’Ascenzo, then the commissioner of the Australian Taxation Office (ATO), described the annual compliance agreement (ACA), which Tom Adams, the finance and business services director of the Australian unit of Alcoa, the multinational aluminium producer, signed on behalf of the company with the Australian Taxation Office on October 30 2012 as historic. It was the first ACA to cover all four taxes: income tax, goods and services tax (GST), fringe benefits tax and excise tax - fuel tax credits. The ATO introduced ACAs in 2008 as an administrative arrangement defining and governing the compliance relationship between it and taxpayers.

“Alcoa is a significant taxpayer in Australia. Achieving this arrangement on four taxes is a great example of our commitment to good corporate governance,” said Alcoa’s managing director in Australia, Alan Cransberg.

“We welcome the ATO’s scrutiny and are open to review of our corporate compliance measures. This sends a strong message to government, and to any other organisation that deals with us, that we are doing the right thing as an Australian company. This commitment by Alcoa also sends a strong message to our own employees by reinforcing that we are an open and values based company.

“Other large organisations have entered into an ACA but Alcoa is the first to sign on four separate taxes, and the first company in Western Australia to enter into any kind of ACA.”

The next ACA to be signed in Australia came two months later when BAE Systems signed one. Though it was not as comprehensive as Alcoa’s as it only covered income tax and GST, the example set by the US company showed that it was possible to finalise an ACA with the ATO.