JOHANNESBURG (miningweekly.com) – The share price of JSE-listed Kumba Iron Ore fell by more than 5% on Tuesday morning after the company announced that it may face an additional R1-billion tax liability for the 2011 tax year.
It noted that its Sishen Iron Ore Company (SIOC) subsidiary had cooperated fully with the South African Revenue Service (Sars) during the course of the audit, but disagreed with the audit findings.
“As a responsible corporate citizen, Kumba and its subsidiaries believe that all taxes owed under South African tax legislation have been paid and that we comply with all applicable tax laws in all jurisdictions in which we operate.
“Kumba generates substantial value for all its stakeholders and is fully committed to the transformation of the South African mining industry and to the wider societal and economic benefits that we bring,” said CEO Themba Mkhwanazi.
He pointed out that Kumba had, in 2015 – a year during which the iron-ore price had fallen sharply – contributed R900-million in corporate taxes and mineral royalties, R4.7-billion in salaries and wages, R15.2-billion in local procurement and R174-million in social investment in health, housing, education and small business development, as well as invested capital of R6.8-billion in the business.
The miner in February reported that SIOC had received a R5.5-billion tax assessment from Sars for the 2006 to 2010 tax years. This included some R3.7-billion in interest and penalties.
SIOC had submitted an objection to that assessment, as well as an application for the suspension of payment in relation to the assessment. It is awaiting a response from the Sars Commissioner on both matters.