LONDON – Tanzania has accused Acacia Mining of under-reporting its revenues and slapped the company with a fine of $190 billion.
Acacia was fined $40 billion for unpaid taxes and $150 billion in penalties and interest owed – but the company has strongly denied any wrongdoing.
The Tanzanian Revenue Authority said the fine related to unpaid historical corporate income tax for Bulyanhulu Gold Mine Limited, which is alleged to have underpaid during the period 2000 – 2017, and Pangea Minerals Limited (PML), which is alleged to have underpaid during the period 2007 – 2017.
The fine is based on findings made by the First and Second Presidential Committees in May and June this year.
“As we have stated previously, Acacia refutes each set of findings and reiterates that it has fully declared all revenues. We have yet to receive copies of the reports issued by the First and Second Presidential Committees,” Acacia said in a statement on Monday.
The company said it has sought international arbitration, that its reporting has been accurate and that it has paid all the appropriate charges. It said in June that the Second Presidential Committee’s findings “grossly overstate the value of the concentrates by more than ten times.”
The company has already had a difficult year: in March, the Tanzanian government banned the export of unprocessed gold and copper, and Acacia was subsequently forced to deny rumours it was exporting despite the ban, citing “misinformation and inaccurate speculation.”
Acacia’s share price dropped 13.39% as of 09:30 a.m. BST (03:30 EST) on Tuesday morning, to its lowest point since 2013. Shares also plummeted in May after the First Presidential Committee reported its findings. As a result of revenues lost to the export ban, the company reported last week that its cash balance had fallen from $318 million to $176 million.
Bloomberg News reported the story earlier.
Employees at Acacia’s mines are 96% Tanzanian and the company says shareholders have funded $4 billion-worth of investment in the country to date.
Acacia said it was “considering all of its options and rights” and would “provide a further update in due course.”
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