PERTH (miningweekly.com) – The Australian High Court on Wednesday dismissed mining major BHP’s attempts to appeal a ruling by the Federal Court holding the miner liable for nearly $90-million in taxes.

The dispute between BHP and the Australian Taxation Office (ATO) has been raging for several years now, with the ATO insisting that the diversified miner should pay tax on the profits made by its Singapore marketing hub through the sale of Australian commodities.

The tax dispute relates to taxes paid between 2003 and 2018.

The Singapore marketing hub is 58% owned by BHP Australia, with the balance held by its British sister company. While BHP had paid Australian tax on the 58% Australian shareholding of the trading hub, the ATO had argued that the company was also liable for tax on the share of the income that the British arm earned from the sale of Australian commodities.

The High Court on Wednesday upheld the Federal Court ruling that the marketing hub was liable for this taxation, as the Australian entities were considered ‘associates’ of the marketing arm.

The ATO has welcomed the High Court decision, with deputy commissioner Rebecca Saint saying the decision meant BHP Australia was taxable on its share of profits derived by the marketing hub from BHP UK’s Australian subsidiaries.

“The resolution of this case in conjunction with BHP’s earlier structural simplification and A$529-million transfer pricing settlement means that this long-running dispute is now concluded, and Australians can have full confidence that BHP, as one of Australia’s largest companies, is paying full tax on its profits from the sale of Australian commodities,” she added.

“Complex domestic and international tax structures of global multinationals have been a focal point of the ATO’s Tax Avoidance Taskforce. This decision validates our robust approach of ensuring complex arrangements comply with Australian taxation laws and that large corporate groups are paying the correct amount of tax.”

BHP in late 2018 agreed to pay some A$529-million in additional taxes to the ATO for income earned between 2003 and 2018 as part of a settlement agreement around the Singapore operations. This was in addition to the A$328-million already paid at that point following the receipt of an amended tax assessment.

The miner in July last year increased BHP Group’s ownership in the marketing arm from 58% to 100%, which will see all profits made in Singapore in relation to Australian commodities, being fully subject to Australian tax.