February 13, 2018 / 6:31 AM / a year ago

Australia's BHP flags $1.8 billion charge from U.S. tax reform

FILE PHOTO: Australian mining company BHP's new corporate logo, released to Reuters from their Melbourne, Australia, headquarters May 15, 2017. BHP/Handout via REUTERS

(Reuters) - BHP Billiton said on Tuesday it will record a $1.8 billion income tax expense due to cuts in the U.S. Federal corporate income tax rate.

The expense, which will be treated as an exceptional item, consists mainly of a non-cash charge on deferred taxes of $898 million and another charge on foreign tax credits of $834 million.

However, the miner said that the lower corporate tax rate will benefit its U.S. attributable profit in the longer term. Its first-half results are due on Feb. 20.

In its second-quarter production report last month, BHP had hinted at a probable charge arising from the lowering of U.S. corporate taxes.

The U.S. House of Representatives in December approved the biggest overhaul of the U.S. tax code in 30 years, lowering the corporate tax rate to 21 percent from 35 percent.

Soon after, fellow Australian companies with U.S. exposure such as engineering firm WorleyParsons and education provider Navitas also flagged one-off charges in relation to the U.S. tax reform.

Reporting by Chris Thomas in Bengaluru; Editing by Richard Pullin and Muralikumar Anantharaman

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below