“Highlights of the 2012 Budget” posted on the Ghana government website in mid-November include a statement that “Beginning in the fiscal year 2012, the following changes to the taxation of mining activities will apply: the corporate tax rate for mining companies will be increased from the current 25% to 35%; a windfall profit tax of 10% will be collected from all mining companies; and a uniform regime for capital allowance of 20% for five years for mining, as is the case in the oil and gas sector, is also established.”
Ghana, with gold production totaling about 3 million oz/y, is the second-largest gold mining nation in Africa after South Africa. Major producers AngloGold Ashanti, Newmont and Gold Fields have operations in the country, as do a number of mid-tier producers. A statement from Gold Fields November 18, 2011, said the company had noted the budget announcement. “We require more details of the proposed tax changes to further assess their potential impact. Accordingly, Gold Fields is not yet in a position to advise shareholders on implications for the company. Once we have completed our assessment we will provide shareholders with further information,” the statement said.
Toni Aubynn, CEO of the Ghana Chamber of Mines, in a phone interview with Ghana Business News, said the taxes would result in lower mining investment in the country; while Ghana Business News also reported that the Ghana Mineworkers’ Union commended government for introducing the windfall profit tax, saying the union hoped the government would be resolute in its successful implementation.