HomeGoldMali raises gold sales tax

Mali raises gold sales tax

Morila “’ one of Mali’s
gold mines, all of
which will now pay
2% more sales tax
Bamako, Mali — 21 May 2012 – Mali’s interim government has raised the combined sales tax on gold by 2 percentage points to 8% “’ a move it says is aimed at bringing it in line with its peers in the West African region.

The tax hike “’ which was announced here in a government statement “’ came as a senior mines ministry official said Mali would  miss its 2012 output target of just over 49 tonnes. The official said it was too early to give a new figure.

Reuters reports that Africa’s No. 3 gold miner remains in political limbo after a 22 March coup, which led to the nation’s neighbours temporarily imposing sanctions and a slowdown of many businesses amid sporadic violence and uncertainty over future leadership.

A mix of Islamist and separatist rebels have also seized the north of the country, though this is far from mining operations, which include Randgold Resources, AngloGold Ashanti and Avion Gold Corporation.

A government statement, seen by Reuters last week after a Wednesday cabinet meeting, said the 2% increase in the ISCP tax on gold ingots to 5% was the only increase in taxes announced by the government. A 3 percent ad valorem tax was maintained, bringing to 8% the total sales tax for gold from Mali, according to a senior mining official.

It is not clear how long the government will remain in place, as the interim president’s term runs out later this week and regional mediators and the military are still at loggerheads over who should oversee the country’s future.

Although the rebels have not threatened mining operations in the south and west, and borders have re-opened since sanctions were lifted, firms have been disrupted.

“There has not yet been an evaluation of the overall impact of the crisis, but everything points to the 49-tonne forecast being lowered,” said the mine ministry official, who asked not to be named.

Mali’s gold revenues surged by more than 20%  in 2011 to US$487 million, tracking a surge in world prices, although gold output slipped to 43.5 tonnes from 46 tonnes in 2010.

The largely desert country relies on gold for about 70% of its export revenues and 15% of gross domestic product.

Source: Reuters. For more information, click here.