2012 Americas School of Mines

Transcription

1 Americas School of Mines Country Fair Mining around the World - South Africa Troopti Naik / Norman Mekgoe

2 Agenda Section one South Africa Alive with possibility (It s possible) Section two Did you know? Section three Mining tax in South Africa Section four Only in South Africa PwC 2

3 Section one Alive with possibility (It s possible) PwC 3

4 2012 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see com/structure for further details.

5 Section two Interesting facts about South Africa PwC 5

6 Interesting facts and statistics about South Africa South Africa is the world's leader in mining and minerals. It has nearly 90% of the platinum metals on earth, 80% of the manganese, 73% of the chrome, 45% of the vanadium and 41% of the gold. In 2005 South Africa was found to be the ninth-largest producer of aluminium, the largest producer of alumino-silicates, chrome ore and ferro-chromium. South Africa was also found to be the second-largest producer of manganese ore and the ninth-largest producer of nickel in the same year. Today, South Africa is the world s largest producer of manganese, platinum, vanadium, and vermiculite. South Africa is the world s second largest producer of ilmenite, palladium, rutile, and zirconium. South Africa is the only country in the world where the government requires 26% ownership in mining companies by previously disadvantaged individuals/groups/organisations. PwC 6

7 Interesting facts and statistics about South Africa The deepest mine is a gold mine in South Africa. In 1977, the Western Deep Levels Mine reached a depth of 11,749 feet. Most mines descend to about 3,300 feet. The vast majority of South African coal exports are shipped through the Richards Bay Coal Terminal (RBCT). With the capacity to export 79.4 mmst annually, RBCT is the world's largest coal export facility. South Africa is one of the most generously endowed geographic solar hotspots in the world, soaking up just over half of the world's highest category of solar wattage per square yard of land. The world's largest diamond was the Cullinan Diamond, found in South Africa in It weighed 3, carats uncut. It was cut into the Great Star of Africa, weighing carats, the Lesser Star of Africa, which weighs carats, and 104 other diamonds of nearly flawless color and clarity. They now form part of the British crown jewels. PwC 7

8 Interesting facts and statistics about South Africa South Africa has 19,004 miles of railway track - 80% of Africa's rail infrastructure. South Africa generates two-thirds of Africa's electricity. South Africa is the first country in Africa to host the prestigious FIFA World Cup (will take place in 2010). PwC 8

9 Section three Mining tax in South Africa PwC 9

10 Mining tax in South Africa Defined in the Income Tax Act as: mining operations and mining include every method or process by which any mineral (including natural oil) is won from the soil or from any substance or constituent thereof. What is a mineral A mineral is any substance that can be got from within the surface of the earth which possesses a value in use, apart from its mere possession of bulk and weight. PwC 10

11 Mining tax in South Africa Definition: capital expenditure incurred The amount by which the expenditure that is incurred during such period in respect of such mine and is capital expenditure, exceeds the sum of the amount received or accrued during the said period from disposals of assets, the costs of which has in whole or in part been included in capital expenditure taken into account for a deduction under section 15(a). Mineral and Petroleum Royalty Act No. 28 of 2008 Effective date 1 May 2010 Only person that extract (win) a mineral resource for their own benefit are subject to the royalty Mineral is subject to the royalty only once Royalty based on value of the mineral mined Calculated on gross sales at the royalty percentage rate determined by a formula PwC 11

12 Mining tax in South Africa Formula: Refined (listed in schedule 1): - Y(u) = {EBIT / (Gross sales x 12.5)} x Minimum rate of 0.5% / maximum rate of 5% Unrefined (listed in schedule 2): - Y(u) = {EBIT / (Gross sales x 9)} x Minimum rate of 0.5% / maximum rate of 7% EBIT = Earnings before interest and taxes (but EBIT can never be less than zero) PwC 12

13 Section four Only in South Africa PwC 13

14 2012 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see com/structure for further details.

15 2012 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see com/structure for further details.

16 2012 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see com/structure for further details.

17 2012 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see com/structure for further details.