St Barbara Limited (ASX: SBM) Responds to PNG Tax Assessment
Key Assessment Details
St Barbara Limited (ASX: SBM) reported that its subsidiary, Simberi Gold Company Pty Ltd, received a substantial tax assessment from the Papua New Guinea Internal Revenue Commission (IRC). The assessment includes additional taxes and penalties totalling PGK 523 million, approximately A$210 million. This primarily comprises PGK 435 million relating to income tax, dating back to 2006, and PGK 88 million concerning deemed dividend withholding tax from a 2018 debt-to-equity transaction.
Company’s Position
In response, St Barbara and Simberi Gold strongly reject the IRC’s findings, asserting that the assessment attempts to retroactively apply penalties beyond the allowed five years for amended tax assessments. They have committed to appealing this assessment within the allocated 60-day period. Managing Director and CEO Andrew Strelein expressed disappointment, highlighting the timing of the IRC’s communication just before the holiday period and reaffirming their intent to work towards resolving the matter with the IRC.
Issues Raised
The IRC’s assessment challenges the claimed depreciation deductions for Allowable Capital Expenditures. St Barbara maintains that their tax filings were properly conducted with the guidance of reputable advisors and insists on the validity of their financial practices. Furthermore, the IRC incorrectly characterised Simberi Gold’s 2018 restructuring as a dividend, which St Barbara clarifies was merely a return of capital.
Future Outlook
St Barbara aims to prepare a comprehensive appeal by 17 February 2025 and is hopeful for a favourable resolution based on their discussions and recalibrated calculations regarding the IRC’s assertions. They remain committed to defending their financial integrity and tax practices in Papua New Guinea.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
This article was generated using GPT-4o mini, a Large Language Model (LLM), to generate summaries of investing news. While AI is generating the content, we know better than to blindly trust our future robot overlords, and every article is edited and fact-checked by an editor holding the appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content of everything published by The Capital Club.