BHP Billiton In Dispute With Australian Tax Office

LONDON -(Dow Jones)- BHP Billiton said Tuesday that the Australian Taxation Office (ATO) has issued assessments and is in dispute with BHP Billiton Limited and its subsidiary company, BHP (Direct Reduced Iron) Pty in respect of the 2000 to 2006 income years.

BHP Billiton maintains that the Group is entitled to the tax relief claimed.

The company said that the dispute is in respect of capital allowances claimed by the BHP Billiton group of companies in relation to Boodarie Iron (Australia) which ceased operations in August 2005.

The dispute involves primary tax of $336 million (A$384 million) and interest (net of tax) and penalties of $307 million (A$350 million).

The Company said it has taken legal advice and remains confident of its position. It intends to vigorously defend the assessment.

The outcome of the dispute is unlikely to be known for some time. In the meantime BHP Billiton believes that the matter is adequately provided for in the accounts, it said

BHP Billiton previously announced in June 2005 that the ATO had issued assessments against BHP Billiton Finance Limited relating to the cost of funding the Boodarie HBI plant.

That matter is currently before the Federal Court of Australia, the company added.