RIO TINTO has warned that it could incur significant additional costs associated with the proliferation of new regulatory initiatives around tax reporting.
In its latest Taxes Paid report, the FTSE 100 mining giant said it paid $7.5bn (£4.5bn) of taxes globally last year, down 19% on 2012, but nevertheless expressed concern that new tax rules would raise future costs for the business.
“A multitude of different reporting formats is unlikely to result in greater clarity and will impose additional costs upon companies, with little or no public benefit,” said Chris Lynch, Rio Tinto’s chief financial officer.
Various worldwide tax reporting initiatives have recently been introduced, or are under consideration, by governments including the US Dodd-Frank Act and the EU’s Accounting Directive.
While Lynch said the diversified miner is a “strong advocate” for global tax transparency he voiced frustration with the number of new initiatives being developed.
“Rio Tinto is concerned about additional compliance costs associated with the proliferation of new regulatory initiatives around worldwide tax reporting that have recently been introduced, or are under consideration, by various governments,” he said.
Potentially, Rio Tinto could face “multiple and inconsistent reporting requirements”, it said in the report and urged governments to work together to “adopt a consistent global approach, which establishes disclosure requirements and thresholds that are proportionate”.
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