Navigating the complexity of the Mining Tax Laws and Incentives
What is included in this article?
Review of Mining Sector Activities – Customs & Excise
Complexity of the Mining Tax Laws and Incentives
The objectives would be to evaluate adequacy, efficiency, and effectiveness of the internal controls within the diesel usage and diesel refund processes.
- Provide reasonable assurance whether the existing key management controls are adequate, effective, and efficient to minimize high-risk areas within the process and manage these risks to an acceptable level.
Carbon Tax
With reference to Customs and Excise Act, No.91 of 19164 legislation, assist:
Carbon Tax Overview:
Carbon Tax is a levy imposed on greenhouse gas (GHG) emissions, primarily generated from burning fossil fuels. This tax can be applied by adding a surcharge to carbon-based fuels and other pollution sources, including industrial processes.
Key Actions:
- Assess Carbon Tax Registration: Review the entity's registration for GHG emissions to determine whether sector-specific thresholds have been met or exceeded.
- Verify Facility Emissions: Ensure that all facilities, including any owned standing generators, are accounted for in the total emissions calculation and the determination of the carbon tax liability.
- Evaluate Allowances: Review all applicable allowances to confirm their completeness and correct application in the calculation and payment of the carbon tax liability.
Diesel Rebate
Review Diesel Fuel Refund Eligibility
- Ensure all required registrations are up-to-date and compliant with the diesel refund regime.
Verify Registration Details
- Confirm that your registration with the diesel refund regime, including VAT registration, is accurate and complete.
Assess Qualifying Activities
- Evaluate and verify that all activities meet the qualifying criteria for inclusion or exclusion under the diesel refund program.
Check Duty at Source (DAS) Rates
•Ensure that the correct DAS rates, as specified in the approved letter, have been applied.
General Imports and Exports
Complexity of the Mining Tax Laws and Incentives
Verify ITAC Permits
Ensure that all ITAC permits are secured for consignments processed under specific rebate items. Confirm that permits are in place for any imported or exported products, equipment, etc., as required.
Analyze Customs Trade Statistics
Review the "Customs Trade Statistics" reflecting import and export activities. Identify and document any anomalies, with reference to the Customs and Excise Act of 1964 and its accompanying Rules. Pay special attention to the following aspects:
- Origin
- Product Classification
- Valuation Criteria
- Completeness of the Bill of Entries
