Alcoa has affirmed to take its fight with the Australian Taxation Office to the Supreme Court. The behemoth organization stated clearly that it does not feel bound by BHP's decision to settle a transfer pricing dispute in 2018.
The ATO strengthened its investigation into Alcoa's sales of Australian alumina earlier this month, asserting the company owed $921 million once interest on unpaid taxes was included.
On 9th July’20, Alcoa’s CEO Roy Harvey was inquired by the investors whether BHP's $529 million settlement over its Singapore hub had created an exemplar that reduced Alcoa's chances of victory in the ATO contention.
Roy was logical to say: ''Each case its own set of specific circumstances.”
“BHP's settlement has been related to iron ore sales to a Singapore subsidiary, while Alcoa's relates to the sale of alumina to a Bahrain company.”
''If it continues grinding against us we will take it all the way through to the Supreme Court.
''We are at the start of a process by which we plan to very much object to how they have reached this conclusion. We simply don't agree with their assessment, we don't agree with how they have chosen to calculate it.”
''We fully believe we can reach a positive conclusion on this.''
Rio Tinto has taken a homogenous reach to Alcoa, preferring to fight its various tax battles with the ATO rather than settle like BHP.
Rio has an $86.1 million dispute over its Australian aluminium subsidiaries.
Alcoa said it would not emanate any provisions for the ATO matter because of its high level of confidence that it will prevail. Despite its stance on accruals, Alcoa will use part of the sum as a tax deduction immediately, telling investors it would reverse that tax deduction in future if it was successful in its fight against the ATO.
The ATO's contention is against Alcoa's joint venture with ASX listed Alumina Limited.
It was earmarked on 9th July’20 that Chinese demand for its eponymous commodity had improved in recent months, lifting alumina prices from $225 per tonne in April to $284 per tonne.
Alumina Limited received $58.6 million of distributions from the joint venture over the past three months, up from $31.3 million in the previous three months.
source https://www.alcircle.com/news/alcoa-affirms-to-take-its-fight-with-australian-taxation-office-to-supreme-court-57441
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