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22 Mar 2018

Nicole Mordant & Chris Mfula, Reuters

Zambia: Tax agency slaps First Quantum with $8 billion tax bill for alleged tax avoidance

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"Zambia slaps miner First Quantum with $8 billion tax bill", 20 March 2018

First Quantum Minerals said on Tuesday that Zambia’s tax agency had slapped it with 76.5 billion Zambian kwacha ($8.04 billion) bill for unpaid import duties, a potentially huge blow for the Canadian miner that earns most its profit in the southern African country. First Quantum, which owns two copper mines in Zambia and has a market value of $11 billion, denied it owed the funds...The massive tax assessment comes at a time when host governments, including Indonesia, Tanzania and Democratic Republic of Congo, are demanding a bigger slice of revenue from miners amid rising commodity prices. “The company unequivocally refutes this assessment which does not appear to have any discernible basis of calculation ...” First Quantum said in a statement. The miner said it would continue working with the Zambian Revenue Authority (ZRA) to resolve the issue...Almost a year ago, tax chief Kingsley Chanda invited companies and people living in Zambia to declare their hidden assets as part of a tax amnesty. There are dozens of mining companies operating in Zambia, mainly extracting copper, including global miners Vedanta Plc and Glencore Plc. ZRA said it has started detailed audits on all companies for compliance.