Value allocation: Upstream and downstream segments
Source: Taxation In Australia Journal Article
Published Date: 1 Aug 2016
Value allocation is required in some tax and duty assessment circumstances in respect of integrated mining or gas to liquid projects. For those projects, the value allocation exercise typically involves an intermediate point dividing, in some way, the supply chain between the upstream segment and the downstream segment. What needs to be determined at such intermediate point for tax and duty purposes is usually the notional market value of a relevant mineral or feedstock gas and/or a notional arm's length charge for access to the downstream infrastructure assets.
To illustrate how this valuation exercise is practically assessed, this article discusses the application of what is referred to as the netback method, which highlights the key principles underpinning the determination of an arm's length access charge and the market value of a commodity at an intermediate point of the supply chain for an integrated mining project.
Sorry, this is subscriber only content.
To gain access to this material and much more - Subscribe Now.
(Note: Members can access Taxation in Australia journal articles without a Tax Knowledge Exchange subscription - please log in to access).
Already a Subscriber? Login now
Details
- Published By: Hung Chu
- Published On:1 Aug 2016
The material is copyright. Apart any fair dealing for the purpose of private study, research criticism or review, as permitted under the copyright Act, no part may be reproduced by any process without written permission from The Tax Institute.
Unless expressly stated, opinions are not that of The Tax Institute, which accepts no responsibility for the accuracy of any of the information contained within it.
The Tax Institute
(ABN 45 008 392 372 (PRV14016))
("TTI")
The Tax Institute is a Recognised Tax Agent Association (RTAA) under the Tax Agent Services Regulations 2009.
Copyright Statement
All materials provided on this site are protected by copyright and are owned by or licensed to TTI.
Except as expressly permitted by TTI or the copyright owner, any person or company who uses this site must not use, reproduce, redistribute, retransmit, publish or otherwise transfer, or commercially exploit, the materials or any information, software or other content, in whole or in part, which is available through this site.
Tags
Share this page