Loading...
See More

Tax will slow investment, warns BHP

May 21 2010 09:01

Company Data

BHP BILLITON PLC [JSE:BIL]

Last traded 287.75
Change -5.55
% Change -0.02
Cumulative volume 323766
Market cap 614.69bn

Last Updated: 23/10/2014 at 10:29. Prices are delayed by 15 minutes. Source: McGregor BFA

Related Articles

BHP blasts Australia mining tax

Moody's warns on Aus 'super tax'

Aus tries to calm 'super tax' fears

BHP pulls rug under metal firms

 
Johannesburg - BHP Billiton [JSE:BIL], the world's largest resources group, on Friday said the the Australian government's proposed super tax on the resources sector has the unintended effect of dramatically slowing investment in Australia and putting the future prosperity and employment prospects of all Australians at risk.

Resources groups are meeting with the Australian government to get a better idea of how the 40% tax on profits generated by resource companies would be imposed and to try and desuede the government from pushing through the tax without further thought.

The tax is seen as being imposed on the "super profits" of mining giants such as BHP Billiton and Rio Tinto that reap the benefits of an Asia-driven commodities boom.

BHP Billiton, which is also listed in South Africa, said the imposition of this new tax would result in an increase in the total effective tax rate on the group's profits earned from its Australian operations from around 43% currently to around 57% from 2013.

Reporting back on its meeting with the Resource Tax Consultation Panel advising the Australian government, BHP Billiton said BHP Billiton said the four principles of sound tax reform were not present in the proposed super tax.

BHP Billiton believes any new tax on the minerals resources industry needs to be prospective in application, so as to preserve Australia's position as a stable place for investment.

It also feels that the government needs to ensure the overall tax burden is competitive with other mineral resources countries, or Australia will lose investment to countries with more attractive tax regimes.

BHP Billiton suggested that the tax vary by commodity, because the investment characteristics and margins of individual minerals are different, and that it be levied on the value of minerals alone - and not unintentionally penalise investments in infrastructure, processing or other enabling activities.

"BHP Billiton conveyed to the Resource Tax Consultation Panel that the proposed tax does not recognise how investment decisions are made in the industry and would place Australia in an uncompetitive position globally," the group said in a statement.   

In particular, BHP Billiton urged the panel to recommend to the government that the time be taken to properly engage with the industry on all aspects of the tax rather
than pursue selective adjustments to achieve the objectives of tax reform that benefits Australia. 

 - I-Net Bridge
[jse:bil]  |  bhp billiton  |  super tax
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

Retailers of any shape and size can now unlock the power of mobile transacting.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...