Report on the total contribution of mining companies in Ghana launched

Category: Business & Economics Created on Thursday, 28 June 2012 09:59 Published Date Written by GNA Hits: 340

Accra, June 27, GNA – The Ghana Chamber of Mines in partnership with PricewaterhouseCoopers Ghana Limited (PwC) has launched a report on the total tax contribution of mining companies in Ghana to enable the public monitor the contribution of the mining industry.

     The study conducted in 2009 and 2010 involved nine mining companies who were asked to provide data on that their taxes and other contributions paid to the Government of Ghana.

     PwC collated and analysed the data provided by the mining companies using the Total Tax Framework without auditing or validating the data received but carried out a sense check to raise queries and identifying and understanding outliers on the data provided by the study participants.

     The results are a measure of the cash taxes paid by the mining companies covering taxes and taxes collected.

     The report showed that for 2010 the total taxes borne by mining companies amounted to 301 million dollars of which 121 million dollars consisted of profit taxes and 113 million dollars of mining specific taxes such as royalties.

      According to the report, the total tax contribution made by the nine companies was 9.6 per cent of government’s total tax revenue.

      It said on the average, a mining company pays 12.8 per cent of their gross revenue as taxes borne and collected to government and 9.2 per cent of a mining entity’s revenue is paid to government in taxes and contributions borne.

      The study said the industry also made significant contributions to developing the catchment area they have their operations.

      Based on the data provided by the participant mining companies, most of the contributions were made towards construction of schools, roads and alternative livelihood initiatives such as palm plantations and health posts making up to 15 per cent of all the other taxes borne.

      This voluntary contribution is equivalent to 32 per cent of the total corporate tax payments made by the survey participants.

      It said the industry was a major employer who pays taxes such as mandatory Social Security contributions on behalf of its employees.

      “The sector also serves as withholding tax agents on the employment income paid to employees”, it said

     It noted that the total the employment taxes borne and collected by mining companies on behalf of employees averaged 4, 200 dollars for every employee.

     The study said the per average employment taxes alone was higher than the per capita income of Ghana which stands at 1, 370 dollars.

     Dr Toni Aubynn, Chief Executive Officer of Ghana Chamber of Mines expressed hope that the report would give opportunity to Ghanaian to appreciate the significant contributions of the industry towards development.