Brazil miner Vale faces tax evasion probe in Switzerland

Dow Jones Newswires/Fox Business, 03/01/2012

Swiss authorities are accusing Brazilian miner Vale SA (VALE, VALE5.BR) of tax evasion following the opening of an office in Switzerland in 2006, Brazil’s O Estado de S.Paulo newspaper reported Thursday, citing a Swiss official and parliamentarians.

The Swiss tax office has opened an investigation into Vale’s tax exempt status in the country following allegations that the miner is using its Swiss office to receive profits made at operations worldwide, Estado said, citing Jean Michel Favez, a member of the Vaud Canton finances commission. The new probe follows previous investigations carried out into the company’s use of its Swiss office by the Vaud parliament’s finances commission, Favez told Estado in an interview.

The investigations were opened after Swiss parliamentarians, including Pierre Zwahlen and Nicolas Rochat, alleged that when Vale gained tax-exempt status in Switzerland in 2006, it declared that its profits in the European nation were less than $50 million a year, but that the office registered profits in 2006 alone of $5.6 billion, indicating the office was receiving profits from abroad, Estado said, citing the parliamentarians. Part of the parliamentarians’ complaint was that extra jobs weren’t created locally with the additional funds, violating another accord Vale had in Switzerland, Estado said.


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