World News

Brazil’s Petrobras loses $2 billion tax dispute, will not re-classify potential loss

RIO DE JANEIRO (Reuters) – Brazil’s state-run oil firm Petrobras has lost an appeal over 9 billion reais ($2.14 billion) of disputed taxes dating from 2011 and 2012, the company said on Tuesday, adding that it was still not changing how the taxes were classified on its balance sheet.

In a securities filing, Petroleo Brasileiro SA <PETR4.SA>, as the firm is formally known, said it will “take the appropriate judicial measures in its defense.”

The firm referred to its 2018 financial results, when the relevant disputed taxes were classified as “non-provisioned judicial processes.” That category is generally reserved for cases where the company has only a remote chance of losing or where the complexity of the matter makes accurately estimating potential losses difficult.

At the end of 2018, Petrobras estimated there were 11.568 billion reais of disputed taxes that fit into that category.

(Reporting by Gram Slattery; Editing by Leslie Adler and Tom Brown)