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29 Jul 2010
BP is chasing a tax credit claim of $9.7bn (£6.3bn).
The oil giant, which is looking to bolster its finances after the Gulf of Mexico oil spill, announced the move in its Q2 results, tax-news.com reported.
BP's group income statement for the second quarter posts a pre-tax charge of $32.2bn linked to the oil spill and a tax credit of $9.79bn.
Under US tax laws, BP can offset a proportion of its losses against US tax, but the move may prompt a backlash from Stateside critics.
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BP seeks tax credit
yes, in today's corporate world it is only fair that either the USA or UK taxpayer picks up the bill through a tax credit. Why should a private or public company face all the costs for its own incompetence when they can get the taxpayer to subsidise it.
The respective Treasuries may need to pass a law that the cost of the oil spill, akin to fines levied, should not be tax deductible.
Posted by: Peter Morris, 29 Jul 2010 | 00:00
Quite rightly
Fines levied in connection with the spill are unlikely to be deductible, and rightly so. This expenditure is a penalty for bad behaviour.
Other costs, such as remedial work and compensation for local livelihoods etc will be. And quite rightly so. This element is a cost of doing business (even if on an unusually large scale in this example). More to the point perhaps, the tax system should not be discouraging expenditure on clean-ups, this expenditure represents good behaviour.
To take another perspective, if the tax receipts have benefited by BP cutting corners in the past, it is only correct that the benefit should be neutralised now to comes to putting it right.
Posted by: Dave, 29 Jul 2010 | 00:00