Oh Singapore, the land of the (tax) free.
Australia is wisening up to the practices of big companies that escape paying high taxes by rerouting big-money transactions to tax-friendly countries like Singapore.
A Senate inquiry on global tax avoidance reveals that global miner BHP Billton has been selling its inventory to its Singapore subsidiary at a cheap rate, which then sells the commodities at a much higher price to China and other nations.
"As a result, billions of dollars in sales is taxed at Singapore's tax rate — which with a range of incentives on offer from the island nation has been reduced to zero in the case of BHP — rather than at Australia's higher 30 per cent corporate tax rate," reports Nassim Khadem on The Sydney Morning Herald.
It's "a strategy allowed under current global tax rules," according to the report.
The bottom line? Australia wants BHP Billton to pay more taxes in Australia — US$409 million to be exact.
Oh Singapore, the land of the (tax) free.
Australia is wisening up to the practices of big companies that escape paying high taxes by rerouting big-money transactions to tax-friendly countries like Singapore.
A Senate inquiry on global tax avoidance reveals that global miner BHP Billton has been selling its inventory to its Singapore subsidiary at a cheap rate, which then sells the commodities at a much higher price to China and other nations.
"As a result, billions of dollars in sales is taxed at Singapore's tax rate — which with a range of incentives on offer from the island nation has been reduced to zero in the case of BHP — rather than at Australia's higher 30 per cent corporate tax rate," reports Nassim Khadem on The Sydney Morning Herald.
It's "a strategy allowed under current global tax rules," according to the report.
The bottom line? Australia wants BHP Billton to pay more taxes in Australia — US$409 million to be exact.