* Government says Vale owes about $15.2 billion in back
* Judgment in case to be made in first half of 2013
* Case relates to foreign profit earned by Vale and other
BRASILIA, Feb 28 Brazil's Supreme Court will
rule in the first half of this year on whether iron ore miner
Vale SA must pay an estimated $15.2 billion in taxes
on earnings from its operations abroad, the president of the
court said on Thursday.
Vale and other companies represented by national industrial
association, the CNI, are disputing back charges the government
is seeking which they say would be tantamount to double
Other companies affected include state-controlled oil
producer Petrobras and privately held engineering
Vale has avoided having to make any payment so far because
of a court injunction, which says it would only have to pay the
taxes if it lost the case. Vale says having to pay the taxes
would disrupt its investment plans.
"This case, that is already being judged, will conclude this
semester," Joaquim Barbosa, president of Brazil's highest court,
told a gathering of foreign correspondents.
He said the case was not specifically related to Vale but
applied to it and other companies with earnings from foreign
Barbosa said the case had been with the Supreme Court for
about six years and some judges who had already voted on it had
since left the court, making it more difficult to achieve a
"coherent" judgment. Most of those judges, whose vote remains
valid after their departure, voted that the taxes on foreign
earnings should be paid.
Vale's chief executive, Murilo Ferreira, told investors on a
conference call on Thursday that the government was discussing
proposed legislation to determine future taxation rules for
Brazilian companies with foreign operations.
"We're expecting a resolution in the coming weeks or
months," Ferreira said of the court case.
Vale posted its first loss in a decade on Wednesday, taking
$5.66 billion in writedowns on money-losing mines.
Ferreira said in Thursday's conference call that higher iron
ore prices and a rise in Vale's gold output would bolster
profits in forthcoming quarters.