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Kampuni ya BARRIC iliwahi kuhukumiwa kuhusika katika ukwepaji wa kodi ya takribani $40-million usd kwa kile kichobainishwa na mahakama kama a “sophisticated scheme of tax evasion”
Katika kipindi cha mwaka 2010 - 2013 kampuni ya BARRIC iliwalipa wanahisa wake zaidi ya $400-million kama gawio,lakini kampuni hiyo haikuilipa serikali ya Tanzania kodi yoyote kwa madai ya kupata hasara.The tribunal ordered the company to pay $41.25-million in taxes to the Tanzanian government.
Barrick Gold subsidiary evaded Tanzanian taxes, tribunal rules.
GEOFFREY YORK
JOHANNESBURG — The Globe and Mail
Published Tuesday, Apr. 05, 2016 5:50PM EDT
The African subsidiary of Barrick Gold Corp. has engaged in a “sophisticated scheme of tax evasion” to dodge more than $40-million (U.S.) in corporate taxes, a Tanzanian tribunal has ruled.
The tribunal, headed by a High Court judge, said the subsidiary of the Toronto-based company had failed to pay any corporate taxes in Tanzania from 2010 to 2013 while still paying more than $400-million in dividends to its shareholders from its gold-mining profits in the East African country.
The tribunal ordered the company to pay $41.25-million in taxes to the Tanzanian government.
The ruling is the latest sign of growing scrutiny of the tax arrangements of foreign investors worldwide, including Canada’s mining companies. The leaked documents known as the Panama Papers are another example of the mounting controversy over alleged tax avoidance.
The Barrick subsidiary said it would appeal the tax ruling to Tanzania’s highest court, calling it a “fundamentally flawed” decision. It denied any wrongdoing, and said it was merely following the terms of its investment agreement with the Tanzanian government.
The London-based subsidiary, formerly known as African Barrick Gold (ABG) and now known as Acacia Mining, is the biggest mining company in Tanzania and operates three major gold mines there.
The Tax Revenue Appeals Tribunal, in a ruling on March 31, said the company’s explanation for its lack of corporate tax payments was “far from plausible.” It accepted the government’s argument that the company’s transactions were “aimed at tax evasion.”
It noted that the company’s three Tanzanian gold mines were its only source of profits for the dividend payout.
“Ultimately, the fact that none of ABG’s subsidiaries is declaring any profit that could provide its holding company with such huge net profits sufficient to distribute to its shareholders four years in a row is what in our respectful opinion constitutes the evidence of a sophisticated scheme of tax evasion,” the tribunal said.
The tribunal’s ruling has sparked much publicity in Tanzania, adding to the growing concerns about foreign miners. “Mining companies have long been suspected of being tax cheats, causing the government to get less than its fair share of revenues from the sector,” one Tanzanian newspaper, The Guardian, said on Monday.
But the Barrick subsidiary sees itself as the victim of a flawed understanding of its tax agreements. It calculates that it has invested about $3-billion in Tanzania and it says the government has agreed that this investment can be deducted from its corporate taxes.
It believes it will be another three years before its corporate tax obligations will outweigh its remaining deductions from those investments. But as a goodwill gesture last month, it agreed to make an advance payment of $20-million on its future corporate tax obligations “to demonstrate our commitment to Tanzania.”
It says it has paid a further $372-million in other taxes and royalties over the past three years.
“Acacia and its subsidiaries fully comply with all international and domestic tax legislation and have not and never will undertake any form of tax evasion or tax avoidance schemes,” the company said on Tuesday in response to the tribunal’s ruling.
Jamie Kneen, a researcher at Ottawa-based civil society group MiningWatch Canada, said many governments in Africa are becoming convinced that the taxes paid by mining companies are insufficient.
“The whole mining sector has been increasingly under the microscope around the world as the public realizes how little it contributes to public accounts in exchange for depleting non-renewable resources and leaving behind massive public liabilities in health and the environment,” he said.
“Tanzania is just one of many countries where tax holidays, sweetheart deals with mining companies and tax evasion have been the subject of heated debate.”
Canada, indeed, has pledged to tackle tax avoidance in the mining sector. In 2013, the federal government promised to help Tanzania and other developing countries to improve their tax-reporting and royalty-collecting systems in the mining and energy sectors.
TAYARI WALISHAHUKUMIWA MWAKA MMOJA ULIOPITA,WANAENDELEA KUKATA RUFAA ZISIZO ISHA HAWATAKI KUUKUBARI UKWELI.
MAGUFULI ALIKUWA ANATAFUTA PA KUANZIA.
LONDON-based giant gold mine company, African Barrick Gold Plc (AB G), has once again lost its appeal against being found to have evaded tax for four years consecutively from 2010, amounting to 81,843,1327 US dollars (over 160bn/-).
This follows the decision of the Court of Appeal to “strike out” the appeal AB G, the appellant, currently known as Acacia PLC, had lodged to fault the judgment issued on March 31, this year, by the Tax Revenue Appeals Tribunal on the matter.
Justices Edward Rutakangwa, Salum Massati and Stella Mugasha ruled in favour of Commissioner General with Tanzania Revenue Authority (TRA) after observing that the appeal by AB G was incompetent for failure to include key documents in the records, like documentary evidence tendered at the trial.
According to the justices, there was no gainsaying here that the omission to include the documentary evidence tendered at the trial does offend against the mandatory provisions of Rule 96 (1) (f) and (2) of the Rules, which is clear and elaborate on what the record of appeal should mandatorily contain.
“We have no flicker of doubt in our minds that these documents are very necessary for conclusive determination of the appeal. Being core or primary documents in this appeal, failure to incorporate them in the record renders the (same) incurably defective and the appeal incompetent,” they declared.
Among such documents were affidavits read and all documents put in evidence at the hearing, the order if any giving leave to appeal, the memorandum of appeal, record of proceedings, the judgment or ruling, the decree or order and the notice of appeal.
The AB G business entities in Tanzania, include Bulyanhulu Gold Mining Limited, North Mara Gold Mining Limited and Pangea Minerals Limited, which operates the Tulawaka and Bunzwagi Gold Mines.
It had declared dividends in UK to its shareholders on the income generated from gold mines operated in Tanzania amounting to 412,504,257 US dollars for 2010 to 2013 years of income.
However, the AB G declared to have incurred loss in Tanzania, where the three gold mine companies operate. Nevertheless, the Tribunal composed of three members under the chairman of High Court Judge Dr Fauz Twaib had stated in its judgment dated March 31, 2016; “Indeed, we share the (Tax Revenue Appeals) Board’s surprise as to how could this be possible,” said the Tribunal.
The Tribunal dismissed the appeal lodged by the company to challenge findings of the Board, saying it was inconceivable that AB G could pay so much money in dividends for four consecutive years, while its only assets were the three loss-making entities incorporated in Tanzania that do not make any profit. “The Board expected some clarification of this rather strange state of affairs and proof as to how it could be possible.
That proof, unfortunately, was not forthcoming from the appellant and its witnesses and counsel’s explanation fell short of an adequate discharge of relevant burden,” the Tribunal observed.
One important issue and which had attracted fierce criticism from the appellant’s counsel stems from the Board’s acceptance of the contention by the Commissioner General of the Tanzania Revenue Authority (TRA), the respondent, that AB G had serious plans to avoid tax.
The Tribunal found that the Board reached such conclusion relying on the fact that all the appellant’s subsidiaries in Tanzania were loss making and therefore not paying dividends to its shareholders and yet at the same time the AB G has consistently been declaring dividends.
“In the circumstances, it is fair to conclude that the respondent’s argument that the transactions were simply a design created by the appellant (AB G) aimed at tax evasion was justified,” the Tribunal declared.
According to the Tribunal, since the company’s only entities that carry on business anywhere in the world were the three Tanzanian gold-mining companies, the AB G’s only source of revenue that could create net profits retained earnings would be the three Tanzanian companies.
Source: Daily News
Katika kipindi cha mwaka 2010 - 2013 kampuni ya BARRIC iliwalipa wanahisa wake zaidi ya $400-million kama gawio,lakini kampuni hiyo haikuilipa serikali ya Tanzania kodi yoyote kwa madai ya kupata hasara.The tribunal ordered the company to pay $41.25-million in taxes to the Tanzanian government.
Barrick Gold subsidiary evaded Tanzanian taxes, tribunal rules.
GEOFFREY YORK
JOHANNESBURG — The Globe and Mail
Published Tuesday, Apr. 05, 2016 5:50PM EDT
The African subsidiary of Barrick Gold Corp. has engaged in a “sophisticated scheme of tax evasion” to dodge more than $40-million (U.S.) in corporate taxes, a Tanzanian tribunal has ruled.
The tribunal, headed by a High Court judge, said the subsidiary of the Toronto-based company had failed to pay any corporate taxes in Tanzania from 2010 to 2013 while still paying more than $400-million in dividends to its shareholders from its gold-mining profits in the East African country.
The tribunal ordered the company to pay $41.25-million in taxes to the Tanzanian government.
The ruling is the latest sign of growing scrutiny of the tax arrangements of foreign investors worldwide, including Canada’s mining companies. The leaked documents known as the Panama Papers are another example of the mounting controversy over alleged tax avoidance.
The Barrick subsidiary said it would appeal the tax ruling to Tanzania’s highest court, calling it a “fundamentally flawed” decision. It denied any wrongdoing, and said it was merely following the terms of its investment agreement with the Tanzanian government.
The London-based subsidiary, formerly known as African Barrick Gold (ABG) and now known as Acacia Mining, is the biggest mining company in Tanzania and operates three major gold mines there.
The Tax Revenue Appeals Tribunal, in a ruling on March 31, said the company’s explanation for its lack of corporate tax payments was “far from plausible.” It accepted the government’s argument that the company’s transactions were “aimed at tax evasion.”
It noted that the company’s three Tanzanian gold mines were its only source of profits for the dividend payout.
“Ultimately, the fact that none of ABG’s subsidiaries is declaring any profit that could provide its holding company with such huge net profits sufficient to distribute to its shareholders four years in a row is what in our respectful opinion constitutes the evidence of a sophisticated scheme of tax evasion,” the tribunal said.
The tribunal’s ruling has sparked much publicity in Tanzania, adding to the growing concerns about foreign miners. “Mining companies have long been suspected of being tax cheats, causing the government to get less than its fair share of revenues from the sector,” one Tanzanian newspaper, The Guardian, said on Monday.
But the Barrick subsidiary sees itself as the victim of a flawed understanding of its tax agreements. It calculates that it has invested about $3-billion in Tanzania and it says the government has agreed that this investment can be deducted from its corporate taxes.
It believes it will be another three years before its corporate tax obligations will outweigh its remaining deductions from those investments. But as a goodwill gesture last month, it agreed to make an advance payment of $20-million on its future corporate tax obligations “to demonstrate our commitment to Tanzania.”
It says it has paid a further $372-million in other taxes and royalties over the past three years.
“Acacia and its subsidiaries fully comply with all international and domestic tax legislation and have not and never will undertake any form of tax evasion or tax avoidance schemes,” the company said on Tuesday in response to the tribunal’s ruling.
Jamie Kneen, a researcher at Ottawa-based civil society group MiningWatch Canada, said many governments in Africa are becoming convinced that the taxes paid by mining companies are insufficient.
“The whole mining sector has been increasingly under the microscope around the world as the public realizes how little it contributes to public accounts in exchange for depleting non-renewable resources and leaving behind massive public liabilities in health and the environment,” he said.
“Tanzania is just one of many countries where tax holidays, sweetheart deals with mining companies and tax evasion have been the subject of heated debate.”
Canada, indeed, has pledged to tackle tax avoidance in the mining sector. In 2013, the federal government promised to help Tanzania and other developing countries to improve their tax-reporting and royalty-collecting systems in the mining and energy sectors.
TAYARI WALISHAHUKUMIWA MWAKA MMOJA ULIOPITA,WANAENDELEA KUKATA RUFAA ZISIZO ISHA HAWATAKI KUUKUBARI UKWELI.
MAGUFULI ALIKUWA ANATAFUTA PA KUANZIA.
LONDON-based giant gold mine company, African Barrick Gold Plc (AB G), has once again lost its appeal against being found to have evaded tax for four years consecutively from 2010, amounting to 81,843,1327 US dollars (over 160bn/-).
This follows the decision of the Court of Appeal to “strike out” the appeal AB G, the appellant, currently known as Acacia PLC, had lodged to fault the judgment issued on March 31, this year, by the Tax Revenue Appeals Tribunal on the matter.
Justices Edward Rutakangwa, Salum Massati and Stella Mugasha ruled in favour of Commissioner General with Tanzania Revenue Authority (TRA) after observing that the appeal by AB G was incompetent for failure to include key documents in the records, like documentary evidence tendered at the trial.
According to the justices, there was no gainsaying here that the omission to include the documentary evidence tendered at the trial does offend against the mandatory provisions of Rule 96 (1) (f) and (2) of the Rules, which is clear and elaborate on what the record of appeal should mandatorily contain.
“We have no flicker of doubt in our minds that these documents are very necessary for conclusive determination of the appeal. Being core or primary documents in this appeal, failure to incorporate them in the record renders the (same) incurably defective and the appeal incompetent,” they declared.
Among such documents were affidavits read and all documents put in evidence at the hearing, the order if any giving leave to appeal, the memorandum of appeal, record of proceedings, the judgment or ruling, the decree or order and the notice of appeal.
The AB G business entities in Tanzania, include Bulyanhulu Gold Mining Limited, North Mara Gold Mining Limited and Pangea Minerals Limited, which operates the Tulawaka and Bunzwagi Gold Mines.
It had declared dividends in UK to its shareholders on the income generated from gold mines operated in Tanzania amounting to 412,504,257 US dollars for 2010 to 2013 years of income.
However, the AB G declared to have incurred loss in Tanzania, where the three gold mine companies operate. Nevertheless, the Tribunal composed of three members under the chairman of High Court Judge Dr Fauz Twaib had stated in its judgment dated March 31, 2016; “Indeed, we share the (Tax Revenue Appeals) Board’s surprise as to how could this be possible,” said the Tribunal.
The Tribunal dismissed the appeal lodged by the company to challenge findings of the Board, saying it was inconceivable that AB G could pay so much money in dividends for four consecutive years, while its only assets were the three loss-making entities incorporated in Tanzania that do not make any profit. “The Board expected some clarification of this rather strange state of affairs and proof as to how it could be possible.
That proof, unfortunately, was not forthcoming from the appellant and its witnesses and counsel’s explanation fell short of an adequate discharge of relevant burden,” the Tribunal observed.
One important issue and which had attracted fierce criticism from the appellant’s counsel stems from the Board’s acceptance of the contention by the Commissioner General of the Tanzania Revenue Authority (TRA), the respondent, that AB G had serious plans to avoid tax.
The Tribunal found that the Board reached such conclusion relying on the fact that all the appellant’s subsidiaries in Tanzania were loss making and therefore not paying dividends to its shareholders and yet at the same time the AB G has consistently been declaring dividends.
“In the circumstances, it is fair to conclude that the respondent’s argument that the transactions were simply a design created by the appellant (AB G) aimed at tax evasion was justified,” the Tribunal declared.
According to the Tribunal, since the company’s only entities that carry on business anywhere in the world were the three Tanzanian gold-mining companies, the AB G’s only source of revenue that could create net profits retained earnings would be the three Tanzanian companies.
Source: Daily News
