Argentina Raids 48 Grain Exporters As Tax Probe Widens
March 01 2011 - 5:18PM
Dow Jones News
Argentina's tax agency has again raided the offices of leading
multinational grain exporting companies, seeking evidence to back
up charges that the companies cheated the government out of about
150 million pesos ($38 million) in taxes.
Agents of the national tax agency Afip raided 117 offices of 48
different exporters amid charges that they created shadow companies
to hide grain sales, Afip said in a press release Tuesday.
A source close to the matter said that Bunge Ltd. (BG), Cargill
Inc., Nidera Handelscompagnie B.V., and Noble Group Ltd. (N21.SG)
were involved in the investigation.
Cargill is the leading exporter of grains in Argentina by
volume, followed by Bunge, Archer Daniels Midland Corp. (ADM),
Louis Dreyfus Commodities, Nidera, Toepfer International GmbH, the
Argentine Cooperative Association, Noble Group, Aceitera General
Deheza SA, and Oleaginosa Moreno SA.
The companies are accused of creating phantom companies using
the names of individuals with limited means and even some who had
died, Afip said.
The latest investigation comes amid a broader crackdown by
Argentine officials on grain exporters, whom the government accuses
of avoiding hundreds of millions of dollars of income taxes.
Agriculture exports were largely responsible for Argentina's
whopping $12.06 billion trade surplus last year, while taxes on
farm exports accounted for a significant percentage of the federal
government's tax revenue. Argentina is the world leader in soymeal
and soyoil exports, ranks No. 2 in corn exports, and third in
soybeans.
Last year, Afip accused four of the country's 10 largest grain
exporters of using shell companies in neighboring Uruguay for
accounting scams which left minimal profits on the books of their
Argentine units.
In November, Afip said it was investigating Molinos Rio de la
Plata SA (MOLI.BA) for possible tax evasion totaling $153 million
on grain export profits.
That followed indictments in October against two executives from
agricultural giant Cargill, freezing 100 million pesos of assets
each for Cargill Argentina Chairman Hector Orlando Marsili and
Cargill Uruguay executive Javier Gustavo Fernandez.
Afip said the Cargill executives conspired to defraud the
government of millions of pesos in taxes from 2000 to 2003, charges
the company denies and has vowed to fight.
Also in 2010, tax inspectors raided the offices of global grains
giant Bunge amid accusations that the company had bilked Argentine
tax authorities out of ARS1.2 billion in income taxes. Bunge denies
the charges and said it will defend itself in court.
-By Shane Romig, Dow Jones Newswires; 54-11-4103-6738;
shane.romig@dowjones.com
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