By Guillermo Parra-Bernal and Brad Haynes
SAO PAULO (Reuters) - Vale SA
The settlement with the government helped the company lowered the disputed tax bill from 45 billion reais.
In a securities filing published on Monday, the Rio de Janeiro-based company said it will not seek legal recourse for back taxes it is currently paying to Brazil on profit from overseas operations between 2003 and 2012. The decision to forego lawsuits was a condition for settling with the government before a November 29 deadline.
But Vale will continue to challenge a tax claim on profit from foreign subsidiaries between 1996 and 2002 as well as in 2013. The company did not say why it will continue to challenge the claim, but some analysts cited evidence suggesting judges could side with the company in the dispute.
"In the event we win the case, we will ask for the immediate refund of the money that has already been paid for the 2003-2012 period ... while ceasing to pay the remaining parcels," the company said in the filing.
Vale claimed the Brazil government, which has been pushing companies to settle old tax debts amid a surge in public spending, was charging taxes to its subsidiaries that had already paid to foreign governments. With units in more than 30 countries and mines from Canada to Mozambique, Vale is Brazil's largest multinational.
Last month, Vale agreed to spread payments over 15 years for 5.965 billion reais, or 27 percent of the total, due in November. Vale also agreed to disburse the remaining 16.36 billion reais in 179 monthly payments.
Preferred shares of Vale, its most widely traded class, rose 0.2 percent to 31.93 reais. The stock is down about 17 percent this year.
($1 = 2.333 Brazilian reais)
(Additional reporting by Walter Brandimarte and Fabiola Gomes; Editing by Alden Bentley and Jeffrey Benkoe)