Argentine authorities suspended the local unit of US seed giant Monsanto from a local grains registry over allegations of tax irregularities. The company denied the allegations in a statement issued late on Wednesday.
Other companies have also been suspended from the registry over similar allegations. Not being on the list means losing some tax benefits and no longer getting permits needed to transport grains within Argentina.
Monsanto was removed from the register because it owes 70 million dollars in taxes for 2001-2005, an Argentine tax official told reporters today in Buenos Aires.
Monsanto will pay a 25% tax rate during the suspension, up from 10%, the official said. Argentina’s tax agency, AFIP, is also investigating Barrick, the world’s biggest gold producer, Cargill Inc., the agricultural commodities trader that’s the largest closely held US company, and Minera Sierra Grande SA, the local unit of Metallurgical Corp. of China Ltd.
AFIP last year said that four of the South American country’s 10 biggest exporters and cereals and soybean processors underpaid taxes. Cereal-producing companies use the register to expedite exporting and reduce export taxes. Argentina is the world’s largest exporter of soy oil, the second-largest of corn and third of soybeans.
Monsanto wasn’t counting on benefiting from the lower tax rate, and the suspension won’t affect business opportunities in Argentina, Kelli Powers, a company spokeswoman, said from headquarters in St. Louis. The suspension doesn’t prohibit Monsanto from doing business in Argentina, the company said on Wednesday in an e-mailed statement.
Bunge Ltd., Argentina’s second-biggest exporter, was suspended on Oct. 1 from the register because of unpaid income taxes since 2006, a tax official said. Bunge will be able to continue exporting, he told reporters at the time.
Monsanto, which sells corn seed in Argentina, was suspended from the register in February for taxes of 40 million pesos (8.5 million dollars), the official said. The company returned to the register after it paid in August, he said. In a separate AFIP investigation, Monsanto may also owe 7 million dollars in property taxes, the official said.