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BHP BILLITON PLC - BHP Economic Contribution Report Extract 2017

Release Date: 20/09/2017 07:05
Code(s): BIL     PDF:  
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BHP Economic Contribution Report Extract 2017

BHP Billiton Plc
Registration number
3196209
Registered in England and
Wales
Share code: BIL
ISIN: GB0000566504


Issued by:                  BHP Billiton Plc


Date:                       20 September 2017


To:                         London Stock Exchange
                            JSE Limited


For Release:                Immediately


Contact:                    Helen Ratsey +44 (0) 20 7802 7540



                      BHP Billiton Plc – Economic Contribution Report 2017



  Introduction
  Our Economic Contribution Report (“Report”) for the year ended 30 June 2017 was released today.
  BHP has a long-standing commitment to transparency. We first disclosed details of our tax and royalty
  payments in 2000 and we have continually updated and expanded our disclosure in the years since.
  As in prior years, the Report discloses the taxes and royalties we paid on a country-by-country and
  project-by-project basis in FY2017. This year, we also disclose our total direct economic contribution
  on a country-by-country basis.

  The Report complies with a number of different transparency regimes. The information on our payments
  to governments is set out in accordance with the UK Regulations, which implement the EU Accounting
  Directive. By issuing the Report, we comply with the Australian Voluntary Tax Transparency Code.
  Beyond these requirements, we voluntarily disclose our total direct economic contribution on a country-
  by-country basis. We also provide details of each of our subsidiaries in ‘tax haven’ countries.

  Our Economic Contribution Report 2017 has today been submitted to the National Storage Mechanism
  and will shortly be available for inspection at: www.morningstar.co.uk/uk/NSM. It is also available to
  be downloaded on the BHP website at: http://www.bhp.com/-/media/documents/investors/annual-
  reports/2017/bhpeconomiccontributionreport2017.pdf

  BHP is proud of the contribution that we make to our host countries. In FY2017, our total economic
  contribution was US$26.1 billion which included payments to suppliers, wages and employee benefits,
dividends, taxes and royalties. This includes our voluntary contributions to our host communities. In
FY2017, we invested US$72.9 million in communities.


In FY2017, we paid US$4.7 billion globally in taxes, royalties and other payments. Our global
adjusted effective tax rate was 34 per cent. Once royalties are included, this rate increases to 44 per
cent.
Below are extracted sections of our full Economic Contribution Report 2017 that together meet the
UK Regulations.
Our payments to governments
Payments made by country and level of government
The information on taxes paid by classification and country presented below has been prepared on the basis set out in the ‘Basis of report preparation’
section of the Report. BHP has prepared this information in accordance with the UK Regulations. Our Report addresses BHP's reporting obligations
under DTR 4.3A of the Financial Conduct Authority's Disclosure Guidance and Transparency Rules. The ‘Basis of preparation’ and ‘Glossary’ contain
information about the content of the Report and form part of the Report.
                                                                                                                                        Payments                         Total
                                                                                                                                                      Signature,                                  Total
                                                            Royalty-                                                                            for                 payments
                                                Corporate                   Taxes                                                                      discovery                              payments
                                                              related                Total taxes                Production            infrastructur                as defined       Other
    US$ millions                                  income                 levied on                 Royalties                  Fees                          and                                      to
                                                             income                         paid               entitlements                       e                 by the UK    payments
                                                    taxes               production                                                                    production                             governmen
                                                                taxes                                                                improvemen                    Regulation
                                                                                                                                                        bonuses                                      ts
                                                                                                                                                 ts                          s


     Total payments to governments
                                                  1,564.4     481.4         148.3       2,194.0     2,115.0           96.5    87.0             9.9         14.9       4,517.4       183.9       4,701.3


     Algeria (1)                                        -           -            -             -           -                     -                -            -                         -
                                                                                                                      92.5                                               92.5                      92.5
    Government of Algeria                               -           -            -             -           -                     -                -            -                         -
                                                                                                                      92.5                                               92.5                      92.5


     Australia (2)                                                                                                        -                                    -
                                                  1,159.7     495.3          42.1       1,697.2     1,911.4                   24.9             3.3                    3,636.8       156.6       3,793.4
    Government of Australia                                                                                               -                       -            -
                                                  1,159.7     495.3          42.1       1,697.2       111.9                    3.9                                    1,813.0       (17.5)      1,795.5
    State of Western Australia                          -           -            -             -                          -                                    -
                                                                                                    1,028.9                   14.7             3.3                    1,046.9        79.0       1,125.9
    Town of Port Hedland (Western Australia)            -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      3.8           3.8
    Shire of East Pilbara (Western Australia)           -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      2.5           2.5
    Shire of Ashburton (Western Australia)              -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      0.4           0.4
    Shire of Wiluna (Western Australia)                 -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      0.8           0.8
    Shire of Leonara (Western Australia)                -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      0.7           0.7
    State of Queensland                                 -           -            -             -                          -                       -            -
                                                                                                      636.8                    3.4                                      640.2        46.1         686.2
    Isaac Regional Council (Queensland)                 -           -            -             -           -              -                       -            -
                                                                                                                               0.1                                         0.1        9.1           9.1
    Mackay Regional Council (Queensland)                -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      0.5           0.5
    State of New South Wales                            -           -                                                     -                       -            -
                                                                               0.0           0.0       90.3                    2.0                                       92.3         9.1         101.4
    Shire of Muswellbrook (New South Wales)             -           -            -             -           -              -      -                -            -             -
                                                                                                                                                                                      0.4           0.4
    State of South Australia                            -           -            -             -                          -                       -            -
                                                                                                       43.5                    0.9                                       44.4         8.6          53.0
State of Victoria                                       -        -      -       -   -   -      -     -   -       -
                                                                                                                     10.0    10.0
Central Highlands Regional Council                      -        -      -       -   -   -      -     -   -       -
                                                                                                                      3.0     3.0
City of Kalgoorlie-Boulder                              -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.1     0.1
City of Rockingham                                      -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.1     0.1
Other Australian Governments                            -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.2     0.2


Brazil                                                           -                  -   -            -   -
                                                     86.8            10.5    97.3            0.0              97.3    5.1   102.5
Government of Brazil                                             -                  -   -            -   -
                                                     86.8            10.5    97.3            0.0              97.3    5.1   102.5


Canada                                                           -      -           -   -                -
                                                     12.3                    12.3            7.6   6.6        26.5    3.7    30.1
Government of Canada                                             -      -           -   -            -   -
                                                     12.6                    12.6            0.1              12.7    0.8    13.5
Government of Saskatchewan                              -        -      -       -   -   -                -
                                                                                             7.4   5.9        13.3    0.1    13.4
Rural Municipality of Leroy (Saskatchewan)              -        -      -       -   -   -      -         -
                                                                                                   0.4         0.4    2.6     2.9
Rural Municipality of Prairie Rose (Saskatchewan)       -        -      -       -   -   -      -         -
                                                                                                   0.2         0.2    0.0     0.2
Government of Ontario                                   -        -      -       -   -   -            -   -
                                                                                             0.0               0.0    0.1     0.1
Government of Quebec                                    -        -      -       -   -   -                -
                                                                                             0.0   0.2         0.2    0.0     0.2
Government of British Columbia                                   -      -           -   -      -     -   -
                                                    (0.3)                   (0.3)                            (0.3)    0.0   (0.3)
Other Canadian Governments                              -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.1     0.1


Chile (3)                                                               -           -   -            -   -
                                                    340.9   (14.0)          326.9           15.4             342.4    4.5   346.8
Government of Chile                                                     -           -   -            -   -
                                                    340.9   (14.0)          326.9           15.3             342.3    3.0   345.3
Municipalidad De Pozo Almonte                           -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.3     0.3
Municipalidad De Sierra Gorda                           -        -      -       -   -   -      -     -   -       -
                                                                                                                      0.6     0.6
Municipalidad De Antofagasta                            -        -      -       -   -   -            -   -
                                                                                             0.1               0.1    0.6     0.7


China                                                            -      -           -   -      -     -   -              -
                                                      0.8                     0.8                              0.8            0.8
China Tax Bureau                                                 -      -           -   -      -     -   -              -
                                                      0.8                     0.8                              0.8            0.8


Colombia                                                         -      -           -   -      -     -   -              -
                                                      1.0                     1.0                              1.0            1.0
Government of Colombia                                           -      -           -   -      -     -   -              -
                                                      1.0                     1.0                              1.0            1.0


India                                                            -      -           -   -      -     -   -
                                                      0.1                     0.1                              0.1    0.6     0.6
Government of India                                  -   -             -     -      -   -     -
                                              0.1             0.1                                  0.1    0.6    0.6


Indonesia                                        -   -   -       -           -      -   -     -
                                                                     0.4                           0.4    1.7    2.1
Government of Indonesia                          -   -   -       -     -     -      -   -     -       -
                                                                                                          1.7    1.7
Ministry of Finance                              -   -   -       -           -      -   -     -             -
                                                                     0.1                           0.1           0.1
State Treasury                                   -   -   -       -           -      -   -     -             -
                                                                     0.3                           0.3           0.3


Japan                                                -   -             -     -      -   -     -             -
                                             (0.4)           (0.4)                                (0.4)         (0.4)
Government of Japan                                  -   -             -     -      -   -     -             -
                                             (0.4)           (0.4)                                (0.4)         (0.4)


Mexico                                           -   -   -       -     -     -          -     -             -
                                                                                  0.1              0.1           0.1
Government of Mexico                             -   -   -       -     -     -          -     -             -
                                                                                  0.1              0.1           0.1


Netherlands                                          -   -             -     -          -     -
                                             (0.0)           (0.0)                0.3              0.2    0.0    0.3
Government of Netherlands                            -   -             -     -          -     -
                                             (0.0)           (0.0)                0.3              0.2    0.0    0.3


Peru                                                 -   -             -     -          -     -             -
                                             17.5            17.5                 0.6             18.0          18.0
Republica Del Peru                                   -   -             -     -          -     -             -
                                             17.5            17.5                 0.6             18.0          18.0


Singapore                                            -   -             -     -          -     -
                                              2.2             2.2                 0.0              2.2    0.2    2.4
Government of Singapore                              -   -             -     -          -     -
                                              2.2             2.2                 0.0              2.2    0.2    2.4


South Africa                                         -   -             -     -      -   -     -             -
                                              1.4             1.4                                  1.4           1.4
Government of South Africa                           -   -             -     -      -   -     -             -
                                              1.4             1.4                                  1.4           1.4


Switzerland                                          -   -             -     -      -   -     -             -
                                              1.5             1.5                                  1.5           1.5
Government of Switzerland                            -   -             -     -      -   -     -             -
                                              1.5             1.5                                  1.5           1.5


Trinidad and Tobago (4)                              -   -             -                -                   -
                                              0.3             0.3          4.0   20.4       3.6   28.3          28.3
Government of the Republic of Trinidad and
                                                     -   -             -                -                   -
Tobago                                        0.3             0.3          4.0   20.4       3.6   28.3          28.3
                                                                       -     -      -   -     -
United Kingdom                                       -   -             -     -      -   -     -
                                             14.3            14.3                                 14.3    4.2   18.6
Government of United Kingdom                         -   -             -     -      -   -     -
                                             14.3            14.3                                 14.3    1.4   15.7
City of Westminster                              -   -   -       -     -     -      -   -     -       -
                                                                                                          2.8    2.8
  United States                                                                            -                                                                      -                                  -
                                                                        (73.8)                           95.6              21.8            203.3                                17.8                               11.3            254.1                7.3       261.4
 Government of United States                                                               -                 -                                  -                 -                                  -                 -                                  -
                                                                        (68.0)                                           (68.0)                                                  0.0                                               (68.0)                         (68.0)
 U.S. Nuclear Regulatory Commission                                           -            -                 -                 -                -                 -                                  -                 -                                  -
                                                                                                                                                                                 0.2                                                  0.2                           0.2
 US Department of the Interior                                                -            -                 -                 -                                  -                                  -                                                    -
                                                                                                                                           160.6                                14.0                               11.2            185.8                          185.8
 US Department of the Treasury                                                             -                 -                                                    -                                  -                 -
                                                                           5.7                                              5.7               0.0                                0.0                                                  5.8               0.6         6.4
 Arizona State Land Department                                                             -                 -                                  -                 -                                  -                 -                                  -
                                                                           0.0                                              0.0                                                  0.6                                                  0.6                           0.6
 Department of Natural Resources (Louisiana)                                  -            -                 -                 -                                  -                 -                -                 -                                  -
                                                                                                                                              2.0                                                                                     2.0                           2.0
 State of Utah                                                                             -                 -                                  -                 -                                  -                 -                                  -
                                                                           0.0                                              0.0                                                  0.1                                                  0.1                           0.1
 State of Texas                                                                            -                                                    -                 -                                  -                 -
                                                                        (13.0)                           72.4              59.4                                                  0.0                                                 59.4               0.3        59.7
 State of Louisiana                                                                        -                                                    -                 -                                  -                 -
                                                                           2.0                           15.7              17.7                                                  0.2                                                 18.0               1.5        19.5
 State of Arkansas                                                            -            -                                                    -                 -                 -                -                 -
                                                                                                          7.0               7.0                                                                                                       7.0               0.0         7.0
 State of New Mexico                                                                       -                 -                                  -                 -                                  -                 -
                                                                         (0.5)                                            (0.5)                                                  0.0                                                (0.5)               0.0        (0.5)
 State of Arizona                                                                          -                 -                                  -                 -                                  -                 -
                                                                           0.0                                              0.0                                                  0.4                                                  0.4               0.0         0.4
 State of California                                                                       -                 -                                  -                 -                                  -                 -
                                                                           0.0                                              0.0                                                  0.0                                                  0.0               0.0         0.1
 Commissioner for the Texas General Land Office                               -            -                 -                 -                                  -                                  -                                                    -
                                                                                                                                            40.6                                 2.1                                0.2              43.0                          43.0
 Railroad Commission of Texas                                                 -            -                                                    -                 -                 -                -                 -                                  -
                                                                                                          0.5               0.5                                                                                                       0.5                           0.5
 Karnes County (Texas)                                                        -            -                 -                 -                -                 -                                  -                 -
                                                                                                                                                                                 0.0                                                  0.0               0.4         0.4
 McMullen County (Texas)                                                      -            -                 -                 -                -                 -                 -                -                 -                 -
                                                                                                                                                                                                                                                        2.5         2.5
 Montgomery County (Texas)                                                    -            -                 -                 -                -                 -                 -                -                 -                 -
                                                                                                                                                                                                                                                        0.5         0.5
 Atascosa County (Texas)                                                      -            -                 -                 -                -                 -                 -                -                 -                 -
                                                                                                                                                                                                                                                        0.2         0.2
 Aldine Independent School District (Texas)                                   -            -                 -                 -                -                 -                 -                -                 -                 -
                                                                                                                                                                                                                                                        0.3         0.3
 White County (Arkansas)                                                      -            -                 -                 -                -                 -                 -                -                 -                 -
                                                                                                                                                                                                                                                        1.0         1.0
 Navajo Nation Council                                                        -            -                 -                 -                -                 -                                  -                 -
                                                                                                                                                                                 0.0                                                  0.0               0.1         0.1


Figures are rounded to the nearest decimal point.

(1) Production entitlements of 2.1 million barrels of oil equivalent (boe) paid in-kind.

(2) The corporate income tax paid in Australia in FY2017 was US$1.2 billion. In addition, we anticipate making final corporate income tax payments in CY2017 of approximately US$1.2 billion relating to FY2017 income. This will increase our total Australian
corporate income tax payments for FY2017 to US$2.4 billion.

(3) Income and mining taxes are paid in Chile on a calendar year basis. However, for the purpose of the Report, taxes paid are included for BHP’s financial year (1 July 2016 to 30 June 2017). For reference, income tax and specific tax on mining activities
paid by Escondida and Pampa Norte for CY2016 amount to US$247 million and US$61 million respectively. Refunds of US$335 million were received during FY2017 primarily in relation to CY2015 Escondida payments which were included in the FY2016 net
corporate income taxes paid to Chile of US$488.5 million.

(4) Production entitlements of 0.1 million boe paid in-kind.
Payments made on a project-by-project basis
Taxes paid by classification and project are presented in this section and have been prepared on the basis set out in the ?Basis of report preparation’
section of the Report.


                                                                                                                                                Payments                         Total
                                                                                                                                                              Signature,                                  Total
                                                                  Royalty-                                                                              for                 payments
                                                      Corporate               Taxes levied                                                                     discovery                              payments
                                                                    related                  Total taxes                Production            infrastructur                as defined       Other
 US$ millions                                           income                          on                 Royalties                  Fees                          and                                      to
                                                                   income                           paid               entitlements                       e                 by the UK    payments
                                                          taxes                 production                                                                    production                             governmen
                                                                      taxes                                                                  improvemen                    Regulation
                                                                                                                                                                bonuses                                      ts
                                                                                                                                                         ts                          s


 Total payments to governments
                                                        1,564.4     481.4           148.3       2,194.0     2,115.0           96.5    87.0             9.9         14.9       4,517.4       183.9       4,701.3


 Petroleum
                                                         237.4      456.7           138.2         832.3       315.2           96.5    38.4             0.2         14.9       1,297.5        25.8       1,323.3
 Australia Production Unit - Western Australia                                           -                         -              -                       -            -
                                                         183.9      155.1                         339.1                                0.5                                      339.6         5.8         345.4
 Australia Production Unit - Victoria                                                    -                         -              -      -                -            -                         -
                                                          (0.0)       22.6                         22.6                                                                          22.6                      22.6
 Bass Strait                                                                             -                         -              -      -                -            -
                                                          (4.3)     278.9                         274.6                                                                         274.6        12.2         286.8
 North West Shelf                                                         -                                                       -                       -            -
                                                         148.7                       42.1         190.8       111.9                    0.3                                      303.0        (0.1)        302.9
 Gulf of Mexico                                                           -              -                                        -                       -
                                                         (10.9)                                   (10.9)      159.1                   14.1                         11.2         173.4         1.5         174.9
 North America Shale (Fayetteville)                           -           -                                                       -                       -            -
                                                                                       7.0           7.0         0.5                   0.0                                         7.5        1.0           8.5
 North America Shale (Haynesville)                                        -                                                       -                       -
                                                         (63.0)                      88.1          25.1        43.7                    2.2                           0.2         71.2         2.9          74.0
 North America Shale (Permian Basin, Eagle Ford)              -           -                                        -              -                       -            -
                                                                                       0.5           0.5                               0.2                                         0.7        1.7           2.4
 Trinidad and Tobago Production Unit (1)                                  -              -                         -                                      -                                      -
                                                            0.7                                      0.7                       4.0    20.4                           3.6         28.7                      28.7
 Algeria Joint Interest Unit (2)                                          -              -                         -                     -                -            -                         -
                                                         (45.3)                                   (45.3)                      92.5                                               47.2                      47.2
 UK Production Unit                                                       -              -                         -              -      -                -            -                         -
                                                            9.6                                      9.6                                                                           9.6                      9.6
 Head Office - BHP Billiton Petroleum International
                                                                          -              -                         -              -      -                -            -                         -
 Pty Ltd                                                   14.6                                    14.6                                                                          14.6                      14.6
 Head Office - BHP Billiton Brasil Investimentos
                                                                          -                                        -              -      -                -            -
 Ltda                                                       0.2                        0.0           0.2                                                                           0.2        0.2           0.4
 Closed Mines                                                             -              -                         -              -                                    -
                                                          (0.1)                                    (0.1)                               0.6             0.2                         0.7        0.1           0.8
 Other                                                                    -                                        -              -                       -            -
                                                            3.3                        0.5           3.8                               0.1                                         3.9        0.6           4.5


 Minerals Americas                                                                                                 -              -                                    -
                                                         451.8      (14.0)           10.0         447.9                               24.3             6.4                      478.5        12.6         491.1
 Escondida                                                                               -                         -              -                       -            -
                                                         307.9      (14.0)                        293.9                               10.7                                      304.6         3.2         307.9
 Pampa Norte                                                              -              -                         -              -                       -            -
                                                           32.5                                    32.5                                2.2                                       34.7         1.1          35.8
 New Mexico Coal                                                                           -                -                                   -                -                                  -                 -
                                                                     (3.8)                                                (3.8)                                                 0.0                                           (3.8)     0.1     (3.7)
 Potash                                                                                    -                -                                   -                -                                                    -
                                                                       6.6                                                 6.6                                                  7.4               6.4                         20.5      3.6     24.0
 Exploration - Minerals Americas                                                           -                -                                   -                -                                  -                 -
                                                                       4.2                                                 4.2                                                  3.9                                             8.1     0.1       8.2
 Head Office - RAL Cayman Inc                                                              -                -                                   -                -                 -                -                 -                   -
                                                                     17.5                                                 17.5                                                                                                17.5              17.5
 Head Office - BHP Billiton Brasil Ltda                                                    -                                                    -                -                                  -                 -
                                                                     87.0                               10.0              97.0                                                  0.0                                           97.0      4.4    101.4


 Minerals Australia                                                                                         -                                                    -                                                    -
                                                                    795.2              38.7                              833.8          1,799.9                                24.1               3.3                       2,661.1   129.3   2,790.4
 Western Australia Iron Ore                                                                                 -                                                    -                                                    -
                                                                    924.8              38.7                              963.5          1,013.1                                10.3               3.3                       1,990.2    51.8   2,042.1
 Olympic Dam                                                                               -                -                                                    -                                  -                 -
                                                                     61.0                                                 61.0              43.5                                2.1                                          106.6    (3.0)    103.6
 New South Wales Energy Coal                                                               -                -                                                    -                                  -                 -
                                                                       0.0                                                 0.0              90.3                                4.2                                           94.5      9.8    104.3
 Exploration - Minerals Australia                                                          -                -                                   -                -                 -                -                 -                   -
                                                                       2.1                                                 2.1                                                                                                  2.1               2.1
 IndoMet                                                                 -                 -                -                 -                                  -                 -                -                 -
                                                                                                                                             0.4                                                                                0.4     1.7       2.1
 Queensland Coal (3)                                                                       -                -                                                    -                                  -                 -
                                                                  (186.7)                                              (186.7)            636.8                                 3.6                                          453.7     73.6    527.3
 Nickel West                                                                               -                -                                                    -                                  -                 -
                                                                     (9.9)                                                (9.9)             15.8                                3.9                                             9.8   (6.7)       3.1
 Head Office - BHP Billiton MetCoal Holdings Pty
                                                                                           -                -                                   -                -                                  -                 -
 Ltd                                                                   3.8                                                 3.8                                                  0.0                                             3.8     2.0       5.8


 Group & Unallocated                                                                       -                                                    -                -                                  -                 -
                                                                     80.0                                 0.0             80.0                                                  0.3                                           80.3     16.2     96.5
 Corporate                                                                                 -                                                    -                -                 -                -                 -
                                                                     76.2                                 0.0             76.2                                                                                                76.2     21.2     97.3
 Marketing                                                                                 -                -                                   -                -                                  -                 -
                                                                       3.9                                                 3.9                                                  0.3                                             4.1   (5.0)     (0.8)
Figures are rounded to the nearest decimal point.
(1) Production entitlements of 0.1 million boe paid in-kind.
(2) Production entitlements of 2.1 million boe paid in-kind.
(3) Royalties, fees and other payments made by BHP Billiton Mitsubishi Alliance Coal Operations Pty Ltd have been included in total payments to the extent of BHP’s ownership of the operating entity, being 50 per cent.
Basis of report preparation
We have prepared the Report in accordance with the UK Regulations.
Taxes, royalties and other payments to governments are presented in the Report on a cash paid and
cash received basis for the year ended 30 June 2017.
The Report includes all such amounts paid and received by BHP in respect of each of our operations.
For our controlled operations, amounts included in our total payments to governments are 100 per cent
of the operations’ payments to governments. For our non-operated and operated joint ventures,
amounts included in our payments to governments are 100 per cent of the amounts paid by BHP and,
in the case of BHP Billiton Mitsubishi Alliance (BMA), 50 per cent of payments made by the operating
entity for BMA in which BHP has a 50 per cent ownership. For our investments in joint ventures and
associates that are equity accounted by BHP, no amounts have been included in our total payments to
governments as BHP is not the operator and does not make payments on behalf of the operation. For
information purposes, 100 per cent of the payments made by our significant equity accounted
investments have been shown on page 4 even though no amounts have been included in our total
payments to governments.
Taxes, royalties and other payments, both cash and in-kind (non-cash), to governments, net of refunds,
are collectively referred to in the Report as ‘Total payments to governments’ and include the following
payment categories:
Corporate income taxes
Payments to governments based on taxable profits under legislated income tax rules. This also includes
payments made to revenue authorities in respect of disputed claims and withholding taxes on dividends
and royalties.
Royalty-related income taxes
Payments to governments in relation to profits from the extraction of natural resources, including
Petroleum Resource Rent Tax (PRRT) in Australia and Specific Tax on Mining Activities (STMA) in
Chile. Royalty-related income taxes are presented as income tax in section 5.1.1 Consolidated Income
Statement in the Annual Report 2017.
Taxes levied on production
Payments to governments in relation to crude excise, carbon tax and severance tax on the extraction
of natural resources. Taxes levied on production are presented as expenses, not income tax, in section
5.1.1 Consolidated Income Statement in the Annual Report 2017.
Royalties
Payments to governments in relation to revenue or production generated under licence agreements.
This also includes payments to revenue authorities in respect of disputed claims. Royalties are
presented as expenses, not income tax, in section 5.1.1 Consolidated Income Statement in the Annual
Report 2017. Royalty-related income taxes are excluded from Royalties.
Production entitlements
Payments to governments entitled to a share of production under production sharing agreements.
Production entitlements are most often paid in-kind. In-kind payments are measured based on the
market value of the commodity on the date of delivery to the government.
Fees
Payments to governments in the form of fees typically levied on the initial or ongoing right to use a
geographical area for exploration, development and/or production. Includes licence fees, rental fees,
entry fees and other payments for licences and/or concessions.
Payments for infrastructure improvements
Payments to governments for the construction of public infrastructure such as roads, bridges and port
facilities.
Dividend payments
Payments to governments with ownership interests in specific assets; not payments to governments
as holders of ordinary shares in BHP. There were no dividend payments to governments for the year
ended 30 June 2017.
Signature, discovery or production bonuses
Payments to governments upon signing an oil and gas lease, when discovering natural resources,
and/or when production has commenced.
Other payments
Payments to governments under other legislated tax rules such as payroll tax, fringe benefits tax,
customs and excise duties, property tax, land tax, stamp duties, and black lung tax. These payments
are not specifically required to be disclosed by the UK Regulations.
Excluded amounts
The following are not included in total payments to governments:
Taxes collected
Tax payments made to governments on behalf of our employees.
Indirect taxes
Tax payments made to, or received from, governments in the nature of Sales Tax, Value Added Tax
and Goods and Services Tax.
Penalties and interest
Payments to governments resulting from the imposition of penalties, fees or interest.
Other
Certain payments, whether made as a single payment or as a series of related payments below
US$100,000 (being a lower amount than the £86,000 threshold set out in the UK Regulations).
Projects
Payments made on a project-by-project basis (‘Payments made on a project-by-project basis’ section
of the Report) present payments by entity when not specifically attributable to a project.
Payments in relation to Corporate Head Office and Marketing Offices have been included in the total
payments to governments as defined by the UK Regulations. The payments are not attributable to
specific projects. Corporate Head Office and Marketing Offices comprise functional support for the
Group that in FY2017 consists entirely of projects that undertake relevant activities as defined by the
UK Regulations.
The ‘Payments made on a project-by-project basis’ section presents corporate income tax amounts for
each project/entity taking into account the effects of tax consolidation in Australia. These include the
following:
- Losses from one entity can be offset against taxable income of another entity within the same tax
consolidated group.
- Only the head entity of a tax consolidated group is liable to make corporate income tax payments to
the Australian Tax Office (ATO).
- Typically, corporate tax groups allocate the aggregate corporate income tax payments made by the
head entity to the ATO amongst entities within the Australian tax consolidated group.
Reporting Currency
All payments to governments in the ‘Our payments to governments’ section have been reported in US
dollars. Payments denominated in currencies other than US dollars are translated for the Report at the
exchange rate at the date of the payment.
Glossary
Australian adjusted effective tax and royalty rate
Total Australian taxation expense excluding exceptional items and exchange movements included in
taxation expense plus royalty expense divided by Profit before taxation, royalties and exceptional items.
Australian adjusted effective tax rate
Total Australian taxation expense excluding exceptional items and exchange movements included in
taxation expense divided by Profit before taxation and exceptional items.
BHP or the Group
BHP Billiton Limited and BHP Billiton Plc and their respective subsidiaries.
Current tax expense
The amount of corporate income tax and royalty-related income tax and production entitlements
currently payable and attributable to the year, measured at rates enacted or substantively enacted at
year-end, together with any adjustment to those taxes payable in respect of previous years.
Deferred tax expense
The amount of corporate income tax and royalty-related income tax and production entitlements
attributable to the current year but payable in future years provided using the balance sheet liability
method.
Global adjusted effective tax and royalty rate
Total taxation expense excluding exceptional items and exchange movements included in taxation
expense plus royalty expense divided by Profit before taxation, royalties and exceptional items.
Global adjusted effective tax rate
Total taxation expense excluding exceptional items and exchange rate movements included in taxation
expense divided by Profit before taxation and exceptional items.
Government
Any national, regional or local authority of a country (includes a department, agency or undertaking that
is a subsidiary undertaking where the authority is the parent undertaking).
Income tax expense
The total of current tax expense and deferred tax expense.
Low-tax jurisdictions
In classifying which countries are ‘low-tax jurisdictions’, we have applied the list of so-called ‘tax haven’
countries released by the European Commissioner on 17 June 2015. This list comprises those so-
called ‘tax haven’ countries that were included on the list of at least 10 individual countries of the
European Union. The countries included on this list originally were: Andorra, Anguilla, Antigua and
Barbuda, Bahamas, Barbados, Belize, Bermuda, British Virgin Islands, Brunei, Cayman Islands, Cook
Islands, Grenada, Guernsey, Hong Kong, Liberia, Liechtenstein, Maldives, Marshall Islands, Mauritius,
Monaco, Montserrat, Nauru, Nieu, Panama, Seychelles, St Kitts and Nevis, St Vincent and the
Grenadines, Turks and Caicos, US Virgin Islands and Vanuatu. This list does not include Singapore.
We will continue to monitor international developments in this area, particularly the EU process to
identify and address third country jurisdictions that fail to comply with tax good governance standards.
The agreed list is due to be released in late CY2017.
Project
Consistent with the UK Regulations, a project is defined as the operational activities that are governed
by a single contract, licence, lease, concession or similar legal agreements and form the basis for
payment liabilities with a government. If multiple such agreements are ‘substantially interconnected’
they may be considered a project. For these purposes ‘substantially interconnected’ means forming a
set of operationally and geographically integrated contracts, licences, leases or concessions or related
agreements with substantially similar terms that are signed with a government, giving rise to payment
liabilities.
Report
The Report has been prepared for BHP’s financial year from 1 July 2016 to 30 June 2017.
UK Regulations
The Reports to Payments to Governments Regulations 2014, as amended by the Reports on Payments
to Governments (Amendment) Regulations 2015. The UK Regulations implement the EU Accounting
Directive (Chapter 10, Directive 2013/34/EU, extended by Directive 2013/50/EU) in the United
Kingdom.




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LEI 549300C116EOWV835768
Registered in England and Wales
Registered Office: Nova South, 160 Victoria Street, London SW1E 5LB United Kingdom

A member of the BHP Group which is headquartered in Australia

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