Column: China’s commodity import trend driven by prices, not economy
China's imports of major commodities are often viewed through the prism of the performance of, and outlook for, the world's second-biggest economy.
Swiss-based commodities trader Glencore (LON:GLEN) has slammed a recent Fairfax Media report that said by claiming Australian tax breaks, the company had paid zero tax over the past three years, despite earning income of A$15bn.
In an email to staff published by Business Insider, Glencore’s coal chief executive, Peter Freyberg, said the firm has paid A$400m in corporate income tax since 2011. He also stated Glencore had paid A$8bn ($7.5bn) in royalties and taxes, including A$2bn related to corporate income tax, in Australia since 2007.
“As you will be acutely aware, for much of this period the resource industries in which we participate have faced significant challenges including low commodity prices, high input costs and a robust Australian dollar,” Freyberg wrote.
“Despite these difficult circumstances, we paid more than $400m in corporate income tax in respect of this period.”
The report also claimed Glencore had borrowed from “associates overseas” at inflated rates of 9% on a $3.4 billion loan, the same amount the company says it has paid in taxes and royalties.
Tax avoidance is highly controversial issue in Australia, where the corporate tax rate is 30%, one of the highest rates in the developed world.
Glencore has operated in Australia for more than 15 years. Other than coal, it also has copper, zinc and nickel operations in the country.
In March the company announced it was closing its Ravensworth underground coal mine (pictured) in the Hunter Valley, due to falling prices and stock surplus in the market.
