Socioeconomic development
Mining and mineral operations can provide a strong base for the economic growth of a local area, a region, or a nation. Rio Tinto focuses on the ways in which it can bring sustainable socio-economic benefits to the areas in which it operates.
Our direct economic contributions are measured by the sum of payments to suppliers and the value that they add. However, our true contribution is far greater than this figure when the secondary or "multiplier" effects of the contributions are included. This is because local and regional economies enjoy additional benefits when workers spend their wages, when governments spend revenues from taxes, and when local communities make use of infrastructure that we create for our operations.
- Economic contributions
- Community contributions
- Tax & royalty
- Procurement
When we invest in a project, the taxes we pay can have a major impact on the country in which we operate. Although federal governments collect most of these payments, a significant proportion of taxes were paid to local and regional governments.
Our analysis only captures where the tax payments are made, and not the internal redistribution of revenues that takes place within governments. How these payments are redistributed depends entirely on the fiscal and administrative structure of the host countries. For this reason, the ultimate effect of these payments at the local level is likely to be underestimated.
In 2008, our total tax and royalty payments were US$6,658 million. Of this, US$6,201 million was borne by the Group. In addition, tax payments of US$457 million were made to governments for employee taxes and other liabilities net of refunds of indirect taxes paid to suppliers.
| Borne | Collected | Refunded (Note 1) | Total | |
|---|---|---|---|---|
| Australia USA Canada Chile France South Africa Germany UK Namibia Indonesia Brazil New Zealand Singapore Other |
3,115 1,503 635 281 154 167 54 37 79 70 18 37 10 41 |
410 180 508 0 71 24 48 93 0 1 3 0 0 46 |
(840) 0 0 0 (35) (3) 0 (32) 0 0 0 (17) 0 0 |
2,685 1,683 1,143 281 190 188 102 98 79 71 21 20 10 87 |
| 6,201 | 1,384 | (927) | 6,658 |
Note 1 - These refunds relate to indirect taxes previously paid on invoices from suppliers, which the Group is entitled to recover. There is therefore no net loss to the governments from these refunds.
1The taxes presented in this section represent all the taxes Rio Tinto paid in 2008. The taxes presented in the section: "Economic contribution" represent the corporate income tax charged to the income statement and therefore does not include all of the different types of taxes paid during the year.
| Australia / New Zealand | North America | South America | Africa | Asia | Europe | Other | Total | ||
|---|---|---|---|---|---|---|---|---|---|
| Corporate income tax Property taxes Payroll taxes paid Government royalties Other taxes |
1,871 7 120 1,070 84 |
1,182 117 269 515 55 |
294 0 2 3 0 |
223 0 3 3 20 |
88 0 0 2 0 |
(5) 14 209 3 31 |
14 4 1 1 1 |
3,667 142 604 1,597 191 |
|
Total taxes borne Taxes collected/(refunded) |
3,152 (447) |
2,138 688 |
299 3 |
249 21 |
90 26 |
252 145 |
21 21 |
6,201 457 |
|
| Total taxes | 2,705 | 2,826 | 302 | 270 | 116 | 397 | 42 | 6,658 |