Ann: Tax Dispute update, page-118

Short answer to Q1 is we don’t know the amount.

The tax office claim revenue was about $54m more than stated, assuming this was all profit, at 30% tax, the bill would be $16m

By coincidence we have $16m in tax credits available.

The amount of gold produced/sold is a very black & white figure and is clearly a clerical error.

The other taxes probably negligible, for example the average professional annual salary in Mali is $1500 so employee tax is small.

VAT what they call TVA could be more, the dispute Randgold won against the tax dept was to do with TVA. Precedents were set in 2016 in relation to TVA so the 2017 accounts would be based on those.

Q2 in relation to disputes, yes there is a system for resolving disputes. This quote from Randgold/Barrick annual reports. (Loulo & Gounkotoare their other mines in Mali)

“Each of Loulo and Gounkoto (which together form the Loulo-Gounkoto complex) and Morila have separate legally binding establishment conventions with the State of Mali, which guarantee fiscal stability, govern applicable taxes and allow for international arbitration in the event of disputes.”

In 2016 Randgold used this arbitration system over a dispute, won the case & received costs & compensation from the tax office. I’ve pasted the relevant section from the 2016 annual report below.

“The International Center for Settlement of Investment Disputes’ (ICSID) arbitration tribunal issued its final and binding award in 2016, resulting in Loulo being awarded $29.2 million in principal (together with an award for costs and interest) from the State of Mali, for monies found by the tribunal to have been wrongfully taken by the government through TVA credits. This amount was subsequently received during the third quarter of 2016.”