UPDATE 1-Petrobras loses Brazil tax case that could cost $1.9 bln

miércoles 2 de marzo de 2016 17:57 GYT
 

(Adds detail of the tax judgment, Petrobras' total potential tax liabilities, and Petrobras response)

SAO PAULO, March 2 (Reuters) - Brazil's state-run oil company, Petrobras, will have to pay 7.3 billion reais ($1.9 billion) in back taxes and fines, the country's tax authority, Carf, has decided.

Petrobras has not made provisions for the tax case, which related to deductions on its 2007 and 2008 filings, and can still be appealed before Carf and the courts. Carf reported the decision on Wednesday.

Carf said Petrobras could not take certain corporate income tax reductions related to its restructuring of Petros, its employee pension fund. The corporate income taxes in question are known in Brazil by their Portuguese initials IRPJ and CSLL.

Petroleo Brasileiro SA, as Petrobras is formally known, faced 19 potential federal, state and municipal tax liability cases totaling 93.5 billion reais ($23.7 billion), according to its third-quarter 2015 financial statements.

Of that amount, Petrobras has provisioned 3.38 billion reais to pay them, an amount less than half the latest judgment against it and below the average 4.92 billion reais for each of the 19 cases.

In the last year, Petrobras has been forced to pay more than 2 billion reais in tax judgments that it had been fighting.

Of the 19 cases listed in the third quarter financial statements, the 7.3 billion real tax judgment against Petrobras was the third-largest potential tax liability.

Petrobras has classified the case, which is awaiting final judgment of appeals under the country's tax system, as a "possible" liability and not a "probable" liability, meaning it does not have to make a provision for the case.

Petrobras said it would wait for formal publication of any Carf decision before it makes any decision on how to deal with it.

Carf and Brazil's finance ministry did not respond to requests for comment. ($1 = 3.94 Brazilian reais) (Reporting by Jeb Blount and Brad Haynes; Editing by Jeffrey Benkoe)