Tanzania says Russia's ARMZ owes $206 mln in taxes

Thu May 23, 2013 9:34am EDT
 
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* Mineral exports up 16 pct in 2012 to $2.3 bln

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DODOMA May 23 (Reuters) - Tanzania is demanding almost $206 million in taxes from Russian state uranium company ARMZ which has won a licence to build the east African country's first uranium mine, the energy minister said on Thursday.

Russia's JSC Atomredmetzoloto (ARMZ) is the mining arm of Russia's nuclear regulator, Rosatom, which also builds nuclear reactors.

Tanzania's tax claim relates to the Mkuju River project in southern Tanzania, which is operated by Toronto-listed Uranium One but owned by ARMZ, the Canadian uranium producer's majority shareholder.

"The Mkuju project ...was sold in December 2010 to ARMZ of Russia after acquiring shares from the parent company, Mantra Resources of Australia," Energy and Minerals Minister Sospeter Muhongo said in a newspaper advertisement of his ministry's 2013/14 budget proposals, which were tabled in parliament on Wednesday.

"Following this deal ... the Tanzania Revenue Authority is claiming $205.80 million, of which $196 million was supposed to have been paid as capital gains tax and $9.8 million as stamp duty."

Muhongo said the company has disputed the tax claim and the matter was now awaiting a court ruling.

Gaudiosus Ishengoma, a lawyer at FB Attorneys which is representing ARMZ in the tax dispute, said the Russian company had successfully challenged the government's tax demands in court. He said the case was now before the Tax Appeals Tribunal of Tanzania.   Continued...