SG-based mining giant BHP Billiton facing >half a billion dollars in tax arrears

[Rogue Trader]

BHP faces 269 million pound tax bill on Singapore marketing hub


Reuters – Mon, Apr 27, 2015 9:36 AM SGT

MELBOURNE (Reuters) - BHP Billiton is contesting A$522 million (269 million pound) in Australian tax bills on its Singapore marketing operations up to 2010, after having paid almost no tax in Singapore since 2006, the global miner told an Australian Senate panel.

The figures were released on Monday by a Senate committee that is investigating corporate tax avoidance. BHP was forced to send written responses to the panel after refusing to disclose the figures at a hearing on April 10.

The company revealed that between 2006 and 2014 its Singapore marketing business earned profits of $5.7 billion, on which it paid just $121,000 in tax in Singapore.

"The Singapore Government has granted BHP Billiton Marketing AG a tax incentive for its marketing activities. BHP Billiton Marketing AG was awarded this incentive for its contributions to the development of Singapore's commodities sector," the company said in its response to the Senate inquiry.

However BHP highlighted that its Singapore marketing hub is 58 percent owned by BHP Billiton, which is dual-listed in Australia and Britain, and paid tax on those earnings also in Australia.

"It is important to note that 58% of the profit which BHP Billiton Marketing AG earns in Singapore from the on-sale of commodities acquired from Australian entities controlled by BHP Billiton Limited is subject to tax in Australia at the company tax rate of 30%," BHP said.

The company paid A$945 million in tax in Australia on its Singapore marketing operation earnings between 2006 and 2014.

The A$522 million in tax bills it faces from Australia include contested tax plus interest and penalties owed on transfer pricing, the price at which BHP's Australian entities sell commodities they mine to the Singapore marketing business.

It also includes tax, interest and penalties the Australian government says is owed from the marketing hub under controlled foreign company rules.

"BHP Billiton has objected to these assessments," the company said.

The company said it is also being audited for taxes paid between 2009 and 2013 under the transfer pricing rules and taxes paid between 2011 and 2014 under the controlled foreign company rules, a period when it was achieving record profits.

BHP, Australia's biggest single taxpayer, and rivals Rio Tinto and Glencore Plc and technology giants like Apple and Google have been targeted by the senate inquiry and the tax office for avoiding tax in Australia.

Rio Tinto revealed at the tax hearing that it pays a 5 percent tax rate on its Singapore marketing operations.

(Reporting by Sonali Paul; Editing by Richard Pullin)

 

[Confuseous]

From
Kong Pih Shu

While I was reading a report on BHP Billiton contesting its tax bill in Australia, one sentence that caught my attention was that between 2006 and 2014, its Singapore marketing business earned profits of US$5.7 billion (S$7.6 billion), from which it paid only US$121,000 in taxes to the Republic.

The firm said in its response to an Australian Senate inquiry that it was granted a tax incentive by the Singapore Government for its contributions to our commodities sector.

The question is what benefits have such companies brought to Singapore? How much have they directly contributed to the development of the commodity sector? How many Singaporeans have they trained in the sector and who are still employed in the industry fruitfully? How many professional, executive, managerial and technician positions do Singaporeans hold in the company?

Have the authorities done “post-mortems” of such incentives given to foreign companies, and whether they achieved the intended objectives? How many tax incentives have been granted and are such grants sustainable? The relevant authorities should address these questions.

http://www.todayonline.com/voices/have-tax-incentives-mncs-paid

 

[Narong Wongwan]

From
Kong Pih Shu

While I was reading a report on BHP Billiton contesting its tax bill in Australia, one sentence that caught my attention was that between 2006 and 2014, its Singapore marketing business earned profits of US$5.7 billion (S$7.6 billion), from which it paid only US$121,000 in taxes to the Republic.

The firm said in its response to an Australian Senate inquiry that it was granted a tax incentive by the Singapore Government for its contributions to our commodities sector.

The question is what benefits have such companies brought to Singapore? How much have they directly contributed to the development of the commodity sector? How many Singaporeans have they trained in the sector and who are still employed in the industry fruitfully? How many professional, executive, managerial and technician positions do Singaporeans hold in the company?

Have the authorities done “post-mortems” of such incentives given to foreign companies, and whether they achieved the intended objectives? How many tax incentives have been granted and are such grants sustainable? The relevant authorities should address these questions.

http://www.todayonline.com/voices/have-tax-incentives-mncs-paid

Trickle down effect mah.....
Likely they bought property, cars, went to casino, whoring, drinking, makan, shopping etc all benefitted sinkies.....

 

[mojito]

Book profits here means it counts towards gdp. Higher gdp means higher bonuses. Very smart, these civil servants.

 

[Rogue Trader]

Lest we forget ....

Singapore in a golden period, says MM Lee

FRAMED against a Saturday night Orchard Road crowd, Minister Mentor Lee Kuan Yew last night sketched a rosy picture of a more vibrant Singapore in five years' time - if it took full advantage of the opportunities now before it.

Aaron Low
Sun, Jul 08, 2007
The Straits Times

FRAMED against a Saturday night Orchard Road crowd, Minister Mentor Lee Kuan Yew last night sketched a rosy picture of a more vibrant Singapore in five years' time - if it took full advantage of the opportunities now before it.

Investors from developed countries are pouring money into the region and Singapore is enjoying good economic growth and social development.

Economic giant China is pulling in foreign investments of US$70 billion (S$106 billion) and India, US$10 billion a year. Foreign direct investments here have maintained at about S$6 billion to S$7 billion.

The stock markets of some Asean countries have risen by an average of 48 per cent.

Asian current accounts are running surpluses with reserves doubling since 2003 to US$2,500 billion.

'If there are no wars or oil crises, this golden period can stretch out over many years,' he said.

The key is having a good government which will get its policies right, to encourage economic growth.

Singapore's economic growth this year will be around 5 per cent to 6 per cent - 'not bad' for a maturing economy with a per capita income of over US$25,000, he said at a Tanjong Pagar GRC event in Ngee Ann City's civic plaza.

'Once you have growth, all problems can be managed. When you have no growth and you have unemployment and no jobs, then all problems become intractable,' he said.

Mr Lee told the sizeable crowd, many of them younger Singaporeans, that they were luckier than him when he was a young man.

'You got the best schools, technical colleges. Nobody is deprived of an education in Singapore and you can go abroad if you do well with bursaries and scholarships.''

He had this message for those in their teens and early 20s: 'You're a generation that is especially blessed. You have ahead of you 10, 15, 20 years.'

Singapore was able to push ahead when China and India adopted wrong economic policies. Although they have recovered and are growing strongly, Singapore is still ahead 'and our job is to stay ahead, and I believe we can'.

Mr Lee said Singapore is in this enviable position today because it had taken 'painful and unpopular measures' after the 1997 Asian financial crisis to get the economy into shape.

The data tells the story: some 9.7 million visitors came here last year; unemployment is at a low 2.9 per cent and 49,000 jobs were created between January and March.

More important, he said, the Government has revised its vision of Singapore - to turn it into a city with a lively night life, a more liberal arts and entertainment scene, the building of the two integrated resorts and the introduction of Formula 1 racing here next year.

'I believe you're going to see a transformation in Singapore. It'll be the most vibrant lively city in this part of the world. And I believe in the next five years, we'll see it evolve.'


[email protected]

 

[Leongsam]

From
Kong Pih Shu

While I was reading a report on BHP Billiton contesting its tax bill in Australia, one sentence that caught my attention was that between 2006 and 2014, its Singapore marketing business earned profits of US$5.7 billion (S$7.6 billion), from which it paid only US$121,000 in taxes to the Republic.

Whatever benefits these companies bring are a bonus to the country. Without the incentives, they wouldn't bother with Singapore at all.

 

[borom]

Book profits here means it counts towards gdp. Higher gdp means higher bonuses. Very smart, these civil servants.

Ministers salaries are also pegged to the top earners (median income of the top 1,000 earners) while they resist having minimum wages for the ordinary man.

 

[laksaboy]

The question is what benefits have such companies brought to Singapore?

Oh, depends on what you mean by 'Singapore'. Be specific.

There are two 'Singapores': the ordinary people, and those rich and powerful closely affiliated with the PAP.

Anytime someone says something like 'let's do this for the benefit of Singapore' or 'let's move on for Singapore', first decipher which 'Singapore' that person is referring to in the doublespeak.