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(Alliance News) - Rio Tinto PLC said Tuesday it will dispute amended assessments brought forward by the Australian Taxation Office.
The tax office has issued the miner with amended assessments of AUD359.4 million - around USD279.8 million - primary tax and AUD47.1 million of interest.
This is on top of more than AUD8.4 billion of Australian income tax paid during the same period, the company highlighted.
"The assessments relate to the denial of interest deductions on an isolated borrowing used to pay an intragroup dividend in 2015. This borrowing was repaid in 2018. Borrowing to fund the payment of a dividend is a normal commercial practice. Rio Tinto is confident of its position and will dispute the assessments," the miner explained.
In line with its usual practice, Rio will pay 50% of the primary tax upfront as part of the objections process, it said.
Last month, Rio Tinto declared a record final dividend as it shrugged off controversy and Covid-19 to post a hefty profit rise for 2020.
Revenue in 2020 was up 3.3% to USD44.61 billion from USD43.17 billion. Its pretax profit surged 38% to USD15.39 billion from USD11.12 billion.
With a 309 US cents final ordinary dividend and 93 cents special dividend, the miner raised its annual dividend by 26% to 557.0 cents from 443.0 cents.
For Rio Tinto, 2020 will be best remembered for the outcry and regulatory scrutiny that followed the miner blowing up a 46,000-year-old Aboriginal heritage site to expand the Pilbara iron ore mine in Western Australia. Following the incident, which took place in May, Jean-Sebastian Jacques resigned as chief executive, replaced by Jakob Stausholm, who had been chief financial officer.
Rio Tinto shares were down 0.1% at 6,299.00 pence in London early Tuesday.
By Tom Waite; thomaslwaite@alliancenews.com
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