Chevron loses tax case, hit with multi-million dollar fine

An aerial view of the Chevorn-operated Gorgon Project.

An aerial view of the Chevorn-operated Gorgon Project.

Chevron will have to pay over $A250 million in back taxes and an estimated $A60 million in fines after having lost a Federal Court case brought by the Australian Taxation Office (ATO).

The ATO accused Chevron of using an in-house loan to an Australian subsidiary worth around $A2.7 billion to raise up to $A862 million in tax-free dividends over five years, utilising a higher interest rate on the loan which was not subject to tax in either Australia or the United States.

A Chevron spokesperson told Gas Today that Chevron Australia is reviewing the decision and does not intend to comment further while appeals are being considered.

“Chevron abides by a stringent code of business ethics, under which we comply with all applicable laws and regulations in the countries in which we operate,” the spokesperson said.

The loans in question took place between the 2003–04 and 2007–08 financial years.

Chevron had argued that the ATO’s claims are invalid, with no profit shifting having taken place.

This story first appeared on PPO News. For more information on the case, click here.

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