Chinese bauxite company BOSAI Minerals’ royalty rate is offset by the company’s Corporate Tax payment whenever the company makes a profit, according to Company Secretary Norman McLean, who is denying royalties are being withheld from the country.
Responding to concerns recently voiced by APNU Member of Parliament Joseph Harmon over royalties that BOSAI is supposed to pay to Guyana for its bauxite extraction, which he estimates to be in the order of US$54 million, McLean has revealed that the company is operating under a Mineral Agreement which provides for a five-year exemption period as a development incentive at the end of which the company is required to pay 1.5 per cent royalties on the FOB value of bauxite mined.
McLean said that after five years the company is required to pay royalties but noted that if the company makes a profit the royalty rate is set off by Corporate Tax. “This is intended as another incentive to encourage companies to be profitable and pay Corporate Tax which is much higher than the 1.5 per cent royalty,”
