“Go home”- Gaskin tells mining companies that record no profits

Feb 06, 2024 News

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“If you out there and you ain’t making nothing, they tell you go home and this is what must be done in Guyana. If you come here, and year after, year after year, you exploiting our people and exploiting our resources, and you can’t make profit and you can’t pay taxes, they tell you go home. So the rule should apply here. You ain’t making profit, what you doing here if you can’t make profit? Go home all of you.”- Ramon Gaskin

…says exploiters dodging tax payments

Kaieteur News – The natural resources of a country are not infinite and if not properly managed can allow for companies to benefit from the massive wealth generated for years to come, while the country will be left desperate for options to sustain its economy.

Bringing this to the fore in a recent interview with Kaieteur News was Civil Society Activist and Economist, Ramon Gaskin.  He was at the time sharing his views on the taxes being lost by this country as a result of poor declarations by the mining companies operating locally. With a specific focus on the significant declines in the gold sector over the past number of years, Gaskin said each citizen should be alarmed.

Declarations from the gold sector have been declining since 2017. In 2023, this trend continued with declarations reducing by a further 11.2 percent. The activist explained that the laws allow for taxes to be waived if a company in the mining industry fails to record profits. This was confirmed by Attorney-at-Law, Khemraj Ramjattan who said companies are not required to pay taxes to the state if for instance its expenses are $5M, but it records an income of $4M. On the other hand, he said a tax of about 28% is charged on profits.

For his part, Gaskin believes that the unlimited waiver on revenues owed to the state must cease forthwith. The activist reasoned, “We have a situation in this country where a Policeman that is receiving $150,000 has to pay his taxes and we have the big mining companies not paying taxes.”

He went on to note that BOSAI Minerals Group told their workers that no bonus would be paid in December 2023, as the company did not record a profit. To this end, he argued, “What kind of company don’t make a profit in bauxite and again they are not paying taxes. This is entirely ridiculous. I can tell you that Omai, this big gold company dig gold from 1993 and 2005, got 3.5 million ounces of gold but never paid taxes, never made a profit.” Though the non-payment of taxes by Omai was not verified by this publication, it was noted that the Canadian gold company enjoyed a low royalty payment on the resources extracted from Guyana.

Omai on its website states: “The payment of gross production royalties are provided for by the Act and the amount of royalty to be paid is prescribed by the Minister. As such royalties may be varied from time to time. Currently, the prescribed royalties on gold production are ad valoren of gross production sales at the following rates: for claim licences 5%; for mining permits for medium scale operations 5%; for mining licences 5%, however recent mineral agreements entered into stipulate a royalty of 8% if the gold price is above US$1,000 per ounce.”

With these generous provisions, Gaskin believes the country is being “ripped off”. He said that Guyana’s natural resources are freely being “fetched away” while police and teachers are forced to pay taxes. Vice President Bharrat Jagdeo previously defended the fiscal incentives extended to investors. He believes that potential investors deserve tax breaks to be able to startup successfully.

Gaskin however believes these lofty measures should not be a lifetime privilege but rather an incentive to commence operations to benefit the country.

According to him, “Companies get tax breaks for pioneer status, where if you want to set up something for the first time you get a break but not for these oil companies and bauxite companies that fetching away the natural resources of this country. There is no such thing as a tax break for that. The natural resources belong to the people of this country and they are fetching it away without paying taxes on it.”

He continued, “When it done, it done, and when you ask them how much profit you made, how much taxes you paid they can’t tell you nothing. How come you making all these sales in bauxite and gold and so on, but you can’t make a profit?”

Gaskin explained that countries like Canada have implemented strict laws and regulations to protect their natural resources. For instance, he noted that companies can be deregistered if no profit is made after five years since this would waive the payment of taxes to that country.

Consequently, he noted, “If you out there and you ain’t making nothing, they tell you go home and this is what must be done in Guyana. If you come here, and year after, year after year, you exploiting our people and exploiting our resources and you can’t make profit and you can’t pay taxes, they tell you go home. So the rule should apply here, you ain’t making profit, what you doing here if you can’t make profit? Go home all of you.”

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• foreign companies, go home, natural resources, profit, taxes

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