JSE-listed Kumba Iron Ore has agreed to settle the tax dispute between its subsidiary, Sishen Iron Ore, and SARS for R2.5 billion.The iron ore producer said that it has agreed with SARS to settle a dispute relating to assessments received for the years 2006 to 2010 and the tax treatment of the relevant issues in the years 2011 to 2015 for this amount.
Kumba Iron Ore first announced the tax discussions between its subsidiary, Sishen Iron Ore, and SARS last year.
Kumba Iron Ore has already provided for R1.5 billion in its annual financial statements for the tax years up to 2015, and an additional R1 billion will be accounted for in 2016 in respect of this settlement agreement.
“The settlement will be paid in full in the first quarter of 2017, with appropriate adjustments made for current advance payments held on account,” the iron ore miner said.
“As a responsible corporate citizen, our policy is to be tax compliant in all jurisdictions in which we operate.”
“I am pleased that we have reached this important settlement with SARS, providing clarity for all and enabling us to focus our efforts on ensuring that Kumba Iron Ore continues to operate at the optimal level and furthers its position as a major economic and social contributor to the South African economy," said Kumba Iron Ore CEO Themba Mkhwanazi.