December 03, 2008

BHP in dispute with Australia tax office

The Australian Taxation Office has issued assessments and is in dispute with BHP Billiton Limited in respect of the 2001 to 2003 income years. BHP Billiton maintains that it is entitled to the tax relief claimed.

The dispute is in respect of payments made pursuant to a plant completion guarantee which had been granted by BHP in 1997 to third party financiers of the Orinoco Project in Venezuela. The dispute involves primary tax and interest of USD 289.6 million. The Australian Taxation Office is still considering whether or not to apply any penalty.

The Company is confident of its position. It intends to vigorously defend the assessment.

The outcome of this 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.