Cemex agrees to pay Mexican tax dispute

Cemex agrees to pay Mexican tax dispute
Published: 12 March 2012

Tagged Under: Mexico Cemex 

Cemex has lost a dispute with the Mexican government over money owed on proceeds from foreign subsidiaries, resulting in the cement producer now paying a fine of at least US$361m in back taxes.

Cemex had contested changes in the law in 2005 that required Mexican companies to pay in Mexico on certain income from foreign subsidiaries where income taxes were less than 75% of the corresponding tax in Mexico.

In September 2008 the Supreme Court overturned on appeal a favourable ruling that Cemex had obtained from a lower court.

In a filing with the Mexican stock exchange, Cemex said it determined its tax debt for 2005 at MXP4.6bn (US$361m), of which it paid around US$72m on 1 March 2012, with the rest to be paid in January 2013. It said fiscal authorities agreed with the amount.

Cemex spokesman Jorge Perez said the company "considers it has adequate provisions to cover this self-assessment."

The company said it hasn't determined how much it owes for 2006 and 2007, but expects it to be "materially lower" than for 2005. Further changes in the law in 2008 mean the company doesn't foresee any effect on accounts for years after 2007.