Spotify funnels subscription revenue out of Australia and through Sweden headquarters
Spotify has shifted its revenue from Australian subscribers out of the country and through its head office in Sweden, according to documents lodged with ASIC.
As the Sydney Morning Herald reports, Spotify recorded no income from subscribers in Australia in 2020, despite its premium subscriber base growing by almost four million around the world to 158 million in Q1 2021. Market research agency Telsyte estimates 7.7 million Australians were using Spotify by the end of last year, making it the most popular streaming service Down Under.
Despite recording no subscription-based income, Spotify did record $24.8 million in advertising revenue from its free service. In the end, it recorded a $9,163 profit for 2020 and paid $588,916 worth of income tax to the Australian Taxation Office for the year.
A Spotify spokesperson defended the move, telling SMH that all was above board.
“Spotify complies with all applicable tax laws in Australia and financial statement requirements, and pays corporate taxes in Australia on taxable profits,” they said.
Spotify’s revenue from its premium services amounted to €1.931 billion (AUD$3 billion) in Q1 2021, up 14% year-on-year. In the same financial results, the streaming service’s monthly active users reached a total of 356 million, up from 345 million in the previous quarter.
It expects its subscriber base to rise to between 162 million and 166 million by the end of this quarter, and revenue to be between €366 billion ($569.44 billion) and €373 billion ($580.33 billion).