Finance Finance News ‘Reach into the couch cushions’: Nick Scali told to pay back JobKeeper millions after record profits
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‘Reach into the couch cushions’: Nick Scali told to pay back JobKeeper millions after record profits

Nick Scali
Nick Scali is under renewed pressure to repay JobKeeper. Photo: TND
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Furniture retailer Nick Scali is under renewed pressure to pay back JobKeeper after its annual profits more than doubled to $84.2 million and the company paid out more than $1 million in executive bonuses.

The business is celebrating a record trading year and just unveiled a $20 million dividend after taking about $7.2 million in JobKeeper payments in 2020.

Yet it still refuses to pay back most of its JobKeeper bill.

In a directors report published to the ASX on Thursday, the company revealed it had paid back $2.47 million after having pledged in February to repay $3.6 million.

The company claimed it removed about $1.13 million from its repayment pledge because this was paid to the government in tax instead.

“The return of JobKeeper was determined to not be deductible by the Australian Taxation Office,” a company spokesperson said on Thursday.

“As it was not treated as a charitable donation … therefore the ATO’s advice provided was to repay the net amount.”

Labor MP Andrew Leigh said the repayment wasn’t enough. He called on Nick Scali to return the full amount after reporting record annual profits.

“Profits have doubled, yet the firm has repaid less than half of the corporate welfare it clearly didn’t need,” Mr Leigh told TND.

“Time for the furniture giant to reach into the couch cushions and repay the rest of its JobKeeper.”

Although taxpayers remain in the red, Nick Scali’s executives have been paid handsomely for the company’s JobKeeper-fuelled profits in 2020-21.

Company chief executive Anthony Scali’s family investment vehicle has now been paid more than $5 million in dividends in the past year alone.

Mr Scali was also paid a $750,000 bonus for the 2020-21 financial year while the company paid out $1.05 million worth of executive bonuses in total.

Nick Scali has been a major beneficiary of the retail boom triggered by the pandemic and has racked up more than $120 million in profits in the past two financial years, about $70 million of which was paid out in dividends.

The business is one of many companies that have agreed to repay some but not all of their JobKeeper windfalls. This group includes Smiggle owner Premier Investments and Rebel Sports owner Super Retail Group.

Few companies have agreed to repay all of their JobKeeper payments, despite many booking record sales and profits after qualifying for JobKeeper support.

A Parliamentary Budget Office report published in July found that $12.5 billion in JobKeeper payments went to companies whose revenue did not fall, despite that being a key legal requirement to receive the payment.

Mr Leigh, who requested the PBO prepare the report, has been pushing the government to publish data about which companies took JobKeeper without needing it, following The New Daily’s report in February showing the Australian Tax Office was tracking company performance.

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