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BHP refuses to answer Senate committee tax questions

AN INQUIRY into tax avoidance turned fiery when BHP Billiton financial staff refused to answer questions from senators about unpaid taxes.

One senator asked if the BHP staff had thought to get the requested information beforehand and asked whether they had read the terms of reference.

Mining companies funnelling revenue overseas to pay lower taxes was under the spotlight on Friday as part of the Senate Economics References Committee public hearing.

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It was revealed that the Australian Tax Office had audited BHP Billiton but staff would not answer specifics.

Greens Senator Christine Milne asked whether BHP Billiton had received a paper from the Tax Office listing how much the company owed in taxes.

But the company's head of group tax Jane Michie refused to answer, saying it was an ongoing process and these things took time.

Ms Milne asked again if they had been issued with a paper from the Tax Office and for the dollar amount it stated and Ms Michie replied "we'd prefer not to answer that question thank you".

A dispute erupted as Ms Michie continued to argue that the company disputed the ATO's stance and that it was not relevant to the company.

But chair Senator Sam Dastyari told the BHP staff "You are testifying before a Senate committee. This is serious".

BHP's corporate affairs president Tony Cudmore asked for them to be exempt from answering the question under "public interest immunity" grounds but the committee dismissed this.

BHP can now either return to the committee with an answer, which they can ask to remain confidential at the discretion of the committee, or continue to refuse. A refusal would refer the matter to the Senate.

Senator Nick Xenophon took a stab at the company's unwillingness to co-operate.

He asked Mr Cudmore more generally about whether the ATO had assessed BHP and Mr Cudmore said he did not have that information.

"You know what this inquiry is about?" Mr Xenophon slammed. "You've read the terms of reference?"

He also asked whether the company thought to get this information beforehand.

"That's pretty extraordinary."

Earlier in the session, Rio Tinto and BHP Billiton admitted they had operations, including "marketing hubs", in Singapore.

BHP Billiton was asked how much profit the Singapore business had made and how much tax it had paid in the country.

But Mr Cudmore said this was commercially sensitive information.

But Rio Tinto 's Australia managing director Phil Edmands said their company's Singapore operation had earned $719 million last financial year and that it paid $44 million in tax. He said their tax rate was 5% in Singapore.

Mr Xenophon asked the BHP representatives why they were not willing to co-operate, claiming there was competitively sensitive information, while their "competitors", Rio Tinto were open.

"Doesn't that make a mockery out of your arguments?" he asked.

"I can't speak for Rio Tinto," Mr Cudmore replied.

Glencore and Adani also fronted the Senate committee.

Topics:  bhp senate committee tax avoidance


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