CHASHA FARMING
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- Jun 4, 2011
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Mining and colonial practices in Tanzania - The return of Victorian era exploitation?
. The government has been described as not benefiting enough from the multinational mining activities in the land. This is attributed to the low royalty rates and unpaid corporate taxes. The report A Golden Opportunity? released by the Christian Council of Tanzania (CCT), the National Muslim CouncilTanzania Episcopal Conference (TEC) in collaboration with Christian Aid (UK) and Norwegian Church Aid shows that the government and its people do incur great losses of tax revenue in the extractive industry. We calculate that Tanzania has lost at least $265.5m in recent years as a result of an excessively low royalty rate, government tax concessions that allow companies to avoid paying corporation tax and possibly even tax evasion by some companies if allegations are true. [FONT=arial,helvetica,sans-serif](AGA) are the main giants in the mining industry in Tanzania. Two Canadian companies, (1999) are currently the two main acts responsible for land issues including compensation. These two laws provide a legal basis on ownership and compensation on land matters. However, there are other laws also with provisions on land acquisition for different uses including starting a mine. In Tanzania these laws are not well applied. The multinational mining companies take advantage of the locals who are not enlightened about the compensation process, their rights and the responsibility of the new land owner in compensating them. Sometimes the companies use administrative and other corrupt measures to avoid making payments. (BAKWATA) and the [/FONT][FONT=arial,helvetica,sans-serif]This is a very conservative estimate, in that it does not cover all the gold mining companies or all figures for recent years (which are not publicly available). Neither does it cover the financial costs of other tax incentives such as VAT exemption, which are extremely difficult to estimate. These extra revenues could of course provide a huge boost to tackling poverty in Tanzania, reads the executive summary of the second edition of the report.
Commissioned by the three main religious bodies in Tanzania and concerning a South African company, this report states that, Company figures show that AngloGold Ashanti has paid taxes and royalties totalling US$144m in 200007 and over the same period has sold around $1.55bn worth of gold, meaning that it has paid the equivalent of around 9 per cent of its exports in remittances to the government. Barrick, meanwhile, does not state on its website how much in taxes and royalties it pays to the Tanzanian government our calculations show that it is paying a figure equivalent to around 13 per cent of its export sales in remittances to the government.
On their visit to the Bulyanhulu Gold Mine site owned by Barrick Gold Corporation, the general manager, Greg Walker,we will begin told the journalists that Barrick [is] not paying corporation taxes, we will only start paying corporation taxes in 2014 when realising profits. This is confirmed further by the report A Golden Opportunity? which states that, Few mining companies have paid corporation tax (levied at 30 per cent of profits) because they have consistently declared losses. Our analysis, drawing on AGA and Barrick company reports, shows that both companies are making gross profits in Tanzania. The report also pinpoints the loopholes from the government of Tanzanias tax regime which give the investors in the extractive industry opportunities for manipulation.
The countrys generous tax concessions mean that they and other companies are able to avoid declaring a taxable income. The Public Accounts Committee (PAC) presented a report to parliament in February 2007 noting that mining companies declared losses of US$1.045bn between 1998 and 2005. It put the losses down to the capital expenditure allowance and weak documentation of records by the Ministry of Energy and Minerals, reads the report. While the investors in the mining sector declare losses all the time, in the wake of the uproar from the citizens about the rampant looting of the natural resources, the government contracted for an independent audit which found that the mining companies were fabricating their losses.
An independent audit conducted by Alex Stewart Assayers (ASA) in 2003, and leaked to the media in 2006, alleged that four gold mining companies, including Barrick and AGA, overstated their losses by US$502m between 1999 and 2003, indicating that the government lost revenues of US$132.5m. The audit also noted that thousands of documents were missing that would have shown whether royalties valued at
SORCE: https://www.jamiiforums.com/PROTESTBARICK.NET[/FONT]
. The government has been described as not benefiting enough from the multinational mining activities in the land. This is attributed to the low royalty rates and unpaid corporate taxes. The report A Golden Opportunity? released by the Christian Council of Tanzania (CCT), the National Muslim CouncilTanzania Episcopal Conference (TEC) in collaboration with Christian Aid (UK) and Norwegian Church Aid shows that the government and its people do incur great losses of tax revenue in the extractive industry. We calculate that Tanzania has lost at least $265.5m in recent years as a result of an excessively low royalty rate, government tax concessions that allow companies to avoid paying corporation tax and possibly even tax evasion by some companies if allegations are true. [FONT=arial,helvetica,sans-serif](AGA) are the main giants in the mining industry in Tanzania. Two Canadian companies, (1999) are currently the two main acts responsible for land issues including compensation. These two laws provide a legal basis on ownership and compensation on land matters. However, there are other laws also with provisions on land acquisition for different uses including starting a mine. In Tanzania these laws are not well applied. The multinational mining companies take advantage of the locals who are not enlightened about the compensation process, their rights and the responsibility of the new land owner in compensating them. Sometimes the companies use administrative and other corrupt measures to avoid making payments. (BAKWATA) and the [/FONT][FONT=arial,helvetica,sans-serif]This is a very conservative estimate, in that it does not cover all the gold mining companies or all figures for recent years (which are not publicly available). Neither does it cover the financial costs of other tax incentives such as VAT exemption, which are extremely difficult to estimate. These extra revenues could of course provide a huge boost to tackling poverty in Tanzania, reads the executive summary of the second edition of the report.
Commissioned by the three main religious bodies in Tanzania and concerning a South African company, this report states that, Company figures show that AngloGold Ashanti has paid taxes and royalties totalling US$144m in 200007 and over the same period has sold around $1.55bn worth of gold, meaning that it has paid the equivalent of around 9 per cent of its exports in remittances to the government. Barrick, meanwhile, does not state on its website how much in taxes and royalties it pays to the Tanzanian government our calculations show that it is paying a figure equivalent to around 13 per cent of its export sales in remittances to the government.
On their visit to the Bulyanhulu Gold Mine site owned by Barrick Gold Corporation, the general manager, Greg Walker,we will begin told the journalists that Barrick [is] not paying corporation taxes, we will only start paying corporation taxes in 2014 when realising profits. This is confirmed further by the report A Golden Opportunity? which states that, Few mining companies have paid corporation tax (levied at 30 per cent of profits) because they have consistently declared losses. Our analysis, drawing on AGA and Barrick company reports, shows that both companies are making gross profits in Tanzania. The report also pinpoints the loopholes from the government of Tanzanias tax regime which give the investors in the extractive industry opportunities for manipulation.
The countrys generous tax concessions mean that they and other companies are able to avoid declaring a taxable income. The Public Accounts Committee (PAC) presented a report to parliament in February 2007 noting that mining companies declared losses of US$1.045bn between 1998 and 2005. It put the losses down to the capital expenditure allowance and weak documentation of records by the Ministry of Energy and Minerals, reads the report. While the investors in the mining sector declare losses all the time, in the wake of the uproar from the citizens about the rampant looting of the natural resources, the government contracted for an independent audit which found that the mining companies were fabricating their losses.
An independent audit conducted by Alex Stewart Assayers (ASA) in 2003, and leaked to the media in 2006, alleged that four gold mining companies, including Barrick and AGA, overstated their losses by US$502m between 1999 and 2003, indicating that the government lost revenues of US$132.5m. The audit also noted that thousands of documents were missing that would have shown whether royalties valued at
SORCE: https://www.jamiiforums.com/PROTESTBARICK.NET[/FONT]
