BlueScope Disputes Tax Bill

Steel producer BlueScope has announced that it will challenge the amended tax return that would require the publicly listed company to pay $203 million.

Australian Tax Office’s revised assessment for 2007 and 2008 fiscal years covers BlueScope’s sale of equipment and a lease-back contract signed in the 2007 fiscal year.

BlueScope entered into the lease-back agreement to raise about $270 million. The deal included selling of a plant and equipment from two Australian ports. BlueScope Steel Finance Ltd owned a nine-percent stake in the venture.

Australian Iron and Steel Pty then leased the assets and then subleased these back to BlueScope.

BlueScope insisted that the company paid the correct taxes related to the agreement. The company would also pursue all options to challenge the Tax Office’s decision.

In light of the announcement, trading for BlueScope (code BSL) shares was down 6.5 percent at $32.25.

BlueScope Steel is one of the largest steel producers in Australia with its corporate headquarters in Melbourne. The company also has presence in Aisa, the Pacific, New Zealand and North America.

In 2002, it was named BHP Steel after spinning off from BHP Hilton. The company was then renamed to BlueScope Steel in November 2003.

BSL currently has more than 17,500 employees. The company, however, announced recently that it is laying off about 1,000 jobs in the next few months.