Taxes & royalties

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.  

Our results

In 2007, our direct tax and royalty charge was US$4,214 million, a 0.5 per cent increase from the 2006 direct tax and royalty charge of US$ 4,195 million.

In many countries where Rio Tinto operates, tax payments are largely based on the preceding year's profits.  As a result, the total tax paid in 2007 does not equal the charge figure reported above, but reflects the company's strong profit growth experienced in 2006.  The total taxes paid by Rio Tinto in 2007 were US$ 4,020 million , compared to US$3,382 million in 2006. Rio Tinto employees (excluding Alcan) paid a further US$642 million in income related taxes.