Malawi is seeking more than $300bn in unpaid mining taxes from US-based company Columbia Gem House on minerals extracted and exported to the US, reported Agence France Presse (AFP) citing Malawi’s attorney general.
In a letter sent last week to the company, Malawi’s attorney general Thabo Chakaka Nyirenda accused Columbia Gem House of avoiding sales duty on rubies and sapphires mined at the Chimwadzulo Mine in Ntcheu, Malawi, from 2008.
In an interview with AFP on 29 July 2022, Nyirenda confirmed the letter.
The minister contends that Columbia Gem House subsidiary Nyala Mines paid only $600 in taxes against anticipated revenues of $24bn from their operation in Malawi.
The letter reads: “Nyala Mines Limited and Columbia Gem House breached (the law) when they failed to disclose all income realised from the investment and when they engaged in trade mispricing and improper transfer pricing techniques.
“It is Malawi’s position that you dishonestly changed the name of the mining company to Nyala Mines Limited to disguise the origin of the company, that is, so that the new name of the company sounded local to avoid suspicion and detection.”
Nyirenda wrote in the letter: “I, therefore, demand from you the payment of the said sum of $309.6bn plus interest at the commercial lending rate from the date the said taxes and royalties fell due to the date of payment within 30 days.”