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ACEP takes on Newmont over less payment of taxes


By: Mathias Amoah- Daily Express with files from GNA

The African Centre for Energy Policy (ACEP), an energy policy think tank said Newmont Ghana is enjoying a lot from the country because Ghana has not been able to capture adequate share of the mineral value over the years.

The energy policy think-tank made this observation at a launch of a report titled: “Golden Days for Newmont.”

Mr. Ismael Ackah, Head of Policy Unit, ACEP who led the discussion said according to Extractive Industries Transparency Initiative (EITI), Newmont is taken advantage of the country’s inability to capture values of gold product produce by the company.

He said this is very serious because government had lost an estimated US$90 million in 2011/2012 as a result of mining stability agreements and US$387 to US$1168 million from non- optimisation of royalty receipt from 1990 to 2007.

Mr. Ackah said from 2010 to 2013, the country’s average share of the total value for gold production was 7%, while government received US$1.7 billion in taxes, the total value of gold production in 2014 was exceeding US$23 billion.

He said the report revealed that from 2003 to 2012, Newmont paid less than US$500 million tax to government despite reporting annual revenues of US$931 million in 2012.

Mr Ackah said the country’s domestic revenue is expected to be 8.1% lower than the 2014 budget estimates, explaining that the situation is likely to persist with decreasing oil revenues which could lead to cut in social services such as education and health.

In order to prevent this from occurring, ACEP is calling for mining investment law to ensure that the country’s mineral revenue is collected, disbursed and spent in a transparent manner.

The Centre suggested that the country needs to introduce a law on resource rent tax in the mining sector to capture a share of excessive profits while introducing other exempted taxes without negatively affecting long term mining investment.

"Government must develop a public investment management plan and judiciously apply mineral revenues to the realisation of government’s investment objectives," the group urged government.

The Centre commended government for re-negotiating the Newmont contract, while urging the Executive government to introduce a law on resource rent tax to capture a share of excessive profits.

ACEP called for effective transparency and accountability to track share of royalties that goes to traditional authorities as well as effective tax administration to detect and publish transfer pricing and other illegal corporate practices.


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