Colombia to turn the heat up on overdue royalties

Multinational mining companies like Drummond and Cerromatoso owe the Colombian state millions of dollars in overdue taxes and royalties, said the country’s Comptroller General’s Office Tuesday.

Colombia Mining

Colombia Mining

According to fiscal watchdog, a recent investigation of 10 mining contracts suggested that $224 million are yet to be paid to the state.

“Colombia does not do a very good job of collecting taxes for the extraction of natural resources.” former congresman and mining consultant Amilkar Acosta told economic magazine Portafolio. “It is inconceivable that while Charquero Manaure in La Guajira pay a 12 percent tax on mined salt, the multinational Greystar, which seeks to exploit gold in Colombia, only pays 4 per cent in royalties for the most precious minerals,” Acosta added.

Cerro Matoso, one of the world’s largest ferronickel producers, owes $16 million to the state, says congressman David Barguil.

Mining companies in Colombia have historically benefited from tax subsidies. According to Acosta, Colombia received $3.6 billion in direct royalties in 2009. According to Portafolio, Colombia, despite its natural resources, receives the least income through taxes and royalties in Latin America.

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