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ISLAMABAD: The Federal Board of Revenue (FBR) has exempted all assets of the Reko Diq gold and copper mining company from capital value tax, which is payable by individuals, firms and companies that acquire an asset by purchase or a right to use for more than 20 years.
The exemption on assets of the Reko Diq Mining Company Limited, formerly Tethyan Copper Company Pakistan (Pvt) Ltd, will come into effect immediately. The government has set Dec 15 for the complete revival of the multibillion-dollar project.
The decision was implemented through SRO 2200 to exempt the project assets from the capital value tax. However, Balochistan Chief Minister Abdul Qudoos Bizenjo has said all provincial taxes would remain effective on the project.
“We have not transferred any of our power to the federal government and also not waived off any of our tax on the Reko Diq project,” he told reporters in Quetta on Tuesday.
On Friday, the Supreme Court of Pakistan also gave its go-ahead for the revival of the Reko Diq project by announcing a short order on a presidential reference pertaining to the validity of the fresh settlement deal between two international firms — Barrick Gold Corporation and Antofagasta PLC — and the government aimed at warding off the $10 billion looming in arbitration penalties on Pakistan.
The revival of the Reko Diq project would give a fillip to the economy by boosting investment sentiments and will increase employment opportunities, added the announcement.
Barrick Gold Corporation ended a long-running dispute with Pakistan earlier this year and would now start to develop one of the world’s biggest gold and copper mining projects.
The project was suspended in 2011 after Pakistan denied Barrick Gold and Chile’s Antofagasta a licence to develop it.
The initially proposed estimates show the Reko Diq project will be built in two phases at an initial estimated capital cost of approximately $7bn and is expected to go into production between the years 2027-28. The project is one of the largest undeveloped copper-gold deposits in the world and will be owned 50pc by Barrick, 25pc by Balochistan province and 25pc by the federal government.
Published in Dawn, December 14th, 2022
