Paul McIntyre: High-flyers travelling in style

Forget the 1980s - Australia is experiencing its biggest run on private planes with waiting lists for some models stretching out to 2009.

But the sobering point for those with enough pocket money to splurge on such machines is that the Australian Taxation Office has noticed the trend too.

This week it flagged plans to match aircraft registers with taxpayer records as part of a broader "conspicuous wealth" project to crack down on tax avoidance among high net worth individuals. The ATO has already dug deep into the affairs of racehorse, luxury car and boat owners.

"The rationale behind this work is that those earning high incomes will accumulate assets instead of paying tax," the ATO said this week.

The new push will track the owners of about 16,000 planes registered by the Civil Aviation Authority and associations such as Recreation Aviation Australia.

But in the face of new interest from the taxman, the business aviation sector is showing no concern. Business demand for planes is booming as security and time become big selling points for corporations - flying schedules can be held tightly, passenger lists are always known and airport delays minimised.

Local aviation groups say deliveries are up 250 per cent this year for models priced between US$3 million ($4.7 million) and US$22 million and manufacturers such as Cessna Citation can't produce enough.

But revelations of jet ownership can still stir up a storm. Just ask James Packer. A few months back there were reports in the Murdoch-owned newspapers in Australia of the media and gambling billionaire planning to blow more than US$100 million on a private jet.

The suggestion was packaged up with a picture of Packer playing polo in England and supposedly enjoying the good life at the top of the family empire.

Packer took umbrage at the coverage, rejecting the claims of a big new plane and blasted the Murdoch papers to bits in rival Fairfax mastheads days later. Packer also took a swipe at News Ltd chairman John Hartigan and his own use of a private jet in Australia. Hartigan then countered, claiming it had not been used since Lachlan Murdoch's exit from News Corp.

Everyone wants a jet, it seems, as long as you're not conveyed too conspicuously.

While we're on the subject of James Packer, he was making headlines again this week as Publishing & Broadcasting revealed its financial results for the past 12 months.

Profits rose 25.6 per cent to A$610 million ($730 million) and for the first time, PBL's ACP magazine business overtook the troubled Nine TV network for profits. Both now lag behind PBL's gaming and casino operations.

Packer also told a news briefing on Wednesday that contrary to market conjecture, PBL would not offload its media assets and that as executive chairman he still rated those divisions highly.

"At the moment I actually think the company is fairly evenly spread between media and gaming," he said

"This notion that we're only interested in gaming or I'm only interested in gaming is not true. No company has aggressively developed their media businesses like we have over the past five years."

Packer even swung in behind the embattled Nine Network, indicating much work was being done to position the broadcaster for the new world.

"We are trying to have a guess what a best-practice free-to-air network is going to look like in 2010 and get there early, not late," he said. "Because of the breadth of businesses in PBL, we can afford to do things today that the other guys can't even think about."

Nine's revenues fell 3.7 per cent to A$870.4 million while earnings before interest, tax, depreciation and amortisation slumped 20.3 per cent to A$215.2 million.

Nine's earnings result was A$46 million lower than ACP Magazines', which posted a 6.8 per cent lift to A$261.4 million off a 6.7 per cent rise in revenues to A$878.6 million.

Packer said ACP and Nine had embarked on another phase of cost-cutting - the TV broadcaster has already cut 240 staff in the past 14 months.

Now, back to the jet.

* Paul McIntyre is a Sydney journalist