Tanzania slaps Acacia Mining with $190b tax bill

Tuesday July 25 2017

President John Pombe Magufuli has been on his

President John Pombe Magufuli has been on his crusade that mining companies that have been working in Tanzania have been ripping off the country, mainly by under-declaring the true worth of what they take out of the country. PHOTO | FILE  

By ALLAN OLINGO
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Tanzania has slapped Acacia Mining with a $190 billion tax bill, potentially escalating the dispute over royalties the government says it is owed.

The firm said it received a notice on the tax bill Monday from the Tanzania Revenue Authority (TRA) for historical corporate income tax, covering the last 17 years.

TRA claims Acacia, the biggest gold miner in the country, owes the government $154 billion from its Bulyanhulu mine and $36 billion from Buzwagi.

The government said the miner owes $40 billion in unpaid taxes and $150 billion in penalties and interest.

The London-listed company however disputes the assessments.

“The assessments are issued in respect of alleged under-declared export revenues, and appear to follow on from the findings of the First Presidential Committee announced on 24 May 2017 and the Second Presidential Committee announced on 12 June 2017. As we have stated previously, Acacia refutes each set of findings and re-iterates that it has fully declared all revenues,” it said.

Acacia has referred the disputes for international arbitration.

Last week, President John Magufuli threatened to shut down all gold mines in Tanzania if the mining firms fail to resolve the tax disputes.

In response to the tax bill, the Barrick Gold-owned company said it is considering all of its options.

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