Fed: Telstra offloads assets to sidestep tax bills, report

AAP General News (Australia)
12-09-2000
Fed: Telstra offloads assets to sidestep tax bills, report

Telstra is reportedly preparing to transfer $5 billion in assets to a shelf company
in Bermuda to avoid huge tax bills.

Today's Australian newspaper says the transfer of assets to the tax haven is central
to the company's new alliance with Pacific Century CyberWorks.

According to legal agreements between the two companies, the offshore deal includes
creating two new companies with headquarters in Bermuda.

The newspaper reports companies registered in Bermuda usually pay no income tax.

The deal could take place as early as next Friday or it could be postponed to March 31 next year.

Stockmarket analysts and Telstra executives say the deal will benefit shareholders
because it avoids the high corporate tax rate in Australia.

Telstra treasurer CLIFF DAVIS is quoted as saying, it's in no way trying to avoid or
minimise tax in Australia but it's trying to not have to pay tax again in some other tax
regime for what is basically restructuring.

AAP RTV sal/alt

KEYWORD: TELSTRA BERMUDA (SYDNEY)

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