Australia's Costello slams J Hardie over asbestos

CANBERRA - Australian Treasurer Peter Costello says James Hardie Industries' attempts to shift the cost of compensating people made ill by asbestos to taxpayers are "shameful."

The Taxation Office last week refused to endorse a James Hardie fund set up to compensate asbestos sufferers as a charity and exempt it from income tax.

The Sydney-based company, the biggest seller of home siding in the US, is still waiting for a second ruling on whether contributions it pledged to make into the fund will be tax deductible.

"This is a company that was too clever by half. Frankly, it's been a shameful record," Costello said in an interview on Sydney radio station 2UE. "What Hardie wants to do is it wants to move as much of the cost as it can on to the tax system."

James Hardie in December 2004 agreed to set up a new fund for asbestos sufferers, ending a two-year fight with victims and unions after revelations the company had under-funded its current asbestos compensation trust. The deal was subject to tax exemptions.

James Hardie started using asbestos in Australia in the 1920s. The company began to phase out blue asbestos in 1968, and all products were asbestos-free by 1986.

- BLOOMBERG