BHP refuses to answer senate inquiry

BHP has been directed on notice by a senate
inquiry
to supply company financial information or risk becoming subject of
the parliamentary senate.

In the Melbourne hearing last Friday federal senators heard evidence
from iron ore majors BHP, Rio Tinto and FMG, at which Rio Tinto and FMG
were compliant
in answering questions about profits going through Singapore
offices.

However, when questioned about the amount of tax being
pursued by the ATO, BHP president (corporate affairs) Tony Cudmore refused to
answer on grounds that it was “competitively sensitive” information, and also
declined to reveal the amount of profit being funnelled through their Singapore
“Marketing Hub”.

Cudmore was openly criticised at the hearing, that his
reasoning was invalid as their direct competitor in Australia Rio Tinto had
freely answered similar questions without complaint.

Although BHP was given the opportunity to ask for
public-interest immunity on the matter, senators refused to allow it, and
demanded that BHP take the questions on notice, and to return the answers
within two weeks.

If the company continues to refuse the order, the matter
will be referred directly to the Senate.

Inquiry chair Sam Dastyari said on the ABC program Insiders that he would be “flabbergasted”
if BHP did not try to resolve the issue.

“If they refuse to give evidence after it’s been requested
by a full-fledged Senate inquiry… it becomes a matter for the Senate,” he said.

Rio Tinto was careful to distinguish that their Singapore
office was not a “Marketing Hub” and instead referred to it as a commercial
centre.

FMG representatives CFO Stephen Pearce and group manager
taxation Marcus Hughes said that “nearly 100 per cent” of Fortescue profits were
taxed in Australia, and that their Singapore office was simply a “small
shipping office”.

Earlier in the day the inquiry heard evidence from Indian
coal miner Adani that they had not yet paid tax in this country due the large
level of investment already undertaken, and that it would be some time after
the Carmichael coal mine began production (anticipated at the end of 2017)
before the company would need to pay tax due to investment offsets.

Image: Newscorp

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