Resolute Mining says it will pay Mali $160 million in tax dispute
The company’s shares in Sydney were suspended on Thursday, after tumbling 40% since news of the detention of CEO Terry Holohan.
Canada’s Yamana Gold (TSX: YRI) (NYSE: AUY) said Wednesday that Argentina’s surprise decision to impose a new tax on all exports could hurt its cash flow, even as the miner is mulling ways to mitigate the impact.
Earlier this month, Argentine President Mauricio Macri and economy minister Nicolás Dujovne announced temporary austerity measures to strengthen the country’s ailing economy.
Yamana, which operates Cerro Moro, Agua Rica and Gualcamayo mines in the country, said it was taking a number of measures to mitigate the financial impact of the new tax.
Among the actions, there is a proposal to impose an export duty of 3 Argentine Pesos per each $1 in exports of goods and services until the end of 2020. With US dollar worth about 37.8 pesos as of Wednesday, companies are looking at a 7.5% tax, which applies to revenues, not earnings, so the impact can be significant.
The Toronto-based miner, which operates the newly-opened Cerro Moro, as well as the Agua Rica and Gualcamayo mines in Argentina, said it was taking a number of measures including adjusting its foreign exchange hedging program due to currency fluctuation in Argentina and other countries.
“Argentina’s export tax has the potential to offset a portion of these benefits,” President and CEO Daniel Racine said in the statement.
Yamana has other two mines in South America and one in its home country — the Canadian Malartic mine, which it owns as part of a 50/50 joint venture (JV) with Agnico Eagle Mines.
Comments
Ivan Fed
Argentina received bailout monies from IMF for $50 Billion dollars. This will create a up market initially, however, situation will be hyperinflation. All companies will plummet in value, sell (AUY) now and move cash to a safer climate.