The world's largest iron ore producer, Vale announced Thursday that the Brazilian government handed down a ruling that the company owes BRL9.8 billion (US$5.6 billion) in unpaid taxes. After the news was delivered, Vale said it would officially file an appeal against the ruling. These tax claims have come at a time when Vale is experiencing growth in its export markets and rising prices in minerals.
In one of many appeals made by Vale, the company has stated that the Brazilian government cannot tax their subsidiaries in other countries because it violates double taxation treaties. The government has been trying to seek out the taxes on profits made by those subsidiaries during the years of 1994 through 2008.