A Canadian gold miner’s repeated refusal to pay taxes in Quang Nam, even though it is not operating at a loss, has severely affected the tax collections of two communes of the central province, a local tax officer has complained.

Besra Vietnam, a subsidiary of the Toronto-based Besra Gold Inc, is exploiting two gold mines in Quang Nam through the Phuoc Son Co Ltd and Bong Mieu Co Ltd.

As of April 2014, the companies have extracted 200,000 ounce, or 5.22 tons of gold, 80 percent of which has been exported, Darin Lee, production-managing director of Besra Vietnam, recently confirmed with Tuoi Tre (Youth) newspaper.

Even so, the gold miners refused to pay duties including natural resources, corporate income, and individual income taxes, despite repeated requests for repayment from the provincial tax department.

“The two companies operated by Besra Vietnam currently owe a total of VND275 billion (US$12.94 million) in tax arrears,” Le Mai Khac Hung, deputy head of the Quang Nam Tax Department, said.

This has resulted in a loss in tax collections at Phuoc Son commune, where the Phuoc Son Co Ltd is located, and Phu Ninh commune, home to the Bong Mieu Co Ltd, Hung said.

Phuoc Son commune has targeted a VND347 billion tax collection in 2014, with more than VND200 billion expected to be collected from the gold miner, but the actual amount collected so far is only VND73 billion.

The commune thus faces financial difficulties in carrying out its investment plan, according to the tax official.

In March 2014, the province’s tax department enacted a coercive measure on the gold mining companies by freezing their bank accounts. But the measure was only in effect for a month as per current law, sending the local taxman to go on with another coercive measure on April 28, which invalidated the companies’ invoices for a year.

Following these coercive measures from the taxman, Besra Vietnam abruptly announced operation shutdowns this week on two of its mining sites, putting 1,000 local workers on the verge of unemployment.

“This reaction is meant to put pressure on the tax authorities,” Hung commented.

“But our coercive measures remain in effect to maintain a fair investment environment for other businesses.”

Hung said it is incomprehensible for a gold mining business that does not operate at a loss to refuse to pay taxes.

The Phuoc Son Co representative has recently worked with local authorities and tax department, and the provincial People’s Committee has agreed to extend the taxpaying time for the gold miner, its deputy chairman Dinh Van Thu told Tuoi Tre on Friday.

“But the company must commit to clear its tax debts and pay taxes on future gold exports,” he said.

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