Chevron loses appeal against $260 million Australia tax bill

Chevron loses appeal against $260 million Australia tax bill

CANBERRA, Australia — An Australian subsidiary of U.S. energy giant Chevron Corp. lost a court appeal on Friday against a 340 million Australian dollar ($260 million) tax bill in a ruling with ramification for how multinational corporations transfer money.

Three judges of the Australian Federal Court unanimously rejected Chevron Australia’s appeal against tax assessments for five years ending in 2008.

The court found the company had reduced its Australian tax cost through 9 per cent tax-deductible interest payments on a $2.5 billion loan from U.S.-based subsidiary Chevron Texaco Funding Corp., which had borrowed the money at a lower rate.

The Australian Taxation Office welcomed the ruling which it said has direct implications for other cases the office is pursuing regarding loans within multinational corporations.

Australia has some of the world’s toughest rules to ensure it collects the correct amount of tax on profits made in the country, said Treasurer Scott Morrison.

Chevron said it was disappointed and might appeal to the High Court of Australia.

“As recognized by the trial court in the dispute, the financing is a legitimate business arrangement and the parties differ only in their assessments of the appropriate interest rate to apply,” a Chevron statement said.

Grant Wardell-Johnson, a tax partner at KPMG, described the ruling as a “critical case.”

“This is a substantial win for the (Australian Taxation) Commissioner, and many taxpayers will need to review their transfer pricing methodologies,” Wardell-Johnson said.

Taxe authorities have said seven global technology, energy and resources companies will receive a combined bill for outstanding tax of AU$2 billion ($1.5 billion) by the end of June. The companies have not been named.

Rod McGuirk, The Associated Press

Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Woman refused entry after refusing to wear mask at store in Kelowna mall

The woman filmed the encounter at LUSH Cosmetics, where wearing a mask in-store is company policy

Smoky skies clearing throughout B.C. Interior

Environment Canada expects “widespread” improvement for all affected areas by Sunday

Stranger in truck grabs boy walking home from school in Kelowna

The 11-year-old boy escaped the incident, RCMP are investigating

Okanagan group calls for inclusive COVID-19 recovery plan

RAMA Okanagan wants full immigration status as part of COVID-19 recovery

Peachland residents march for better forest management

The Peachland march was one of many like it across B.C.

3 new deaths due to COVID-19 in B.C., 139 new cases

B.C. confirms 40 ‘historic cases,’ as well

Supreme Court Justice Ruth Bader Ginsburg dies at 87

The court’s second female justice, died Friday at her home in Washington

‘This is a very difficult sentencing’; Judge delays Okanagan manslaughter trial to next week

The courts heard Friday that Bourque “did not intend to cause harm” but that her actions were “reckless”

Emaciated grizzly found dead on central B.C. coast as low salmon count sparks concern

Grizzly was found on Gwa’sala-‘Nakwaxda’xw territory in Smith Inlet, 60K north of Port Hardy

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

VIDEO: B.C. to launch mouth-rinse COVID-19 test for kids

Test involves swishing and gargling saline in mouth and no deep-nasal swab

Young Canadians have curtailed vaping during pandemic, survey finds

The survey funded by Heart & Stroke also found the decrease in vaping frequency is most notable in British Columbia and Ontario

B.C. teachers file Labour Relations Board application over COVID-19 classroom concerns

The application comes as B.C.’s second week of the new school year comes to a close

CHARTS: Beyond Metro Vancouver, COVID-19 cases in B.C. haven’t increased much recently

COVID-19 case counts outside of Metro Vancouver have been level since July

Most Read