Is the mining industry in Nevada paying its fair share?
AIR DATE: March 23, 2011
A popular cry from Nevadans is a call for the mining industry to pay its fair share of taxes. Recent discoveries in Carson City show mining has not been properly audited in the past two years. But, is this an issue that will tear northern and southern Nevadans apart? And are lawmakers looking to squeeze more out of the mining industry to help deal with budget woes?
Jim Wadhams, lobbyist for Newmont Mining from the Jones Vargas law firm.
Robert Fulkerson, Progressive Leadership Alliance of Nevada.
I think you're on to something. Interestingly enough, some of teh big mines, such as NEM (Newmont) and Barrick are audited by PWC. PricewaterhouseCoopers was appointed in May 2002 as Newmont's independent public accountants, replacing Arthur Andersen LLP. As we know Arthur Anderson was shut down because they were involved with the ENRON Debacle. http://www.prnewswire.eu/cgi/news/release?id=92971
You're right, FIN 48, and Sarbanes-Oxley, and the Dodd Frank Act may have required them to disclose this at some point over the last decade. Hell, Dodd-Frank requires them to report every time MSHA writes them or a contractor up...but not this?
The SEC, like the Nevada Tax Commission, apparently didn't have the proper staffing either. Wow!ENRON –Nov 2, 2011 22:08:53 PM
The mines were taking tax deductions they were not entitled to, which apparently has occurred for about a decade. Is this tax evasion? Although these mines are audited by PWC, and file with the SEC, why wasn't this caught 10 years ago?
The tax commission director admitted that the mines weren't being audited by them, so if PWC (one of the largest public accounting firms), the SEC (securities and exchange commission, and the mines themselves are unwilling to regulate them, and oversee them, what is to protect the shareholders from another ENRON or Madoff from occurring?
Possibly in response to the decision by the legislature, it is rumored and speculated that Newmont was going to start Closing down certain departments in Nevada. This seems ironic seem as how Newmont has gone on record to say they are creating jobs...I'm not sure that is the case. Nonetheless, these mines should be held accountable for their past actions. It seems as if FAS 142 would have required them to disclose this tax risk to shareholders so they could have avoided buying ownership into this flat company, but that's a job for the SEC...oh wait...they're understaffed too.Skeptical Shareholder (former) –Jul 11, 2011 19:02:41 PM
Sorry, FIN 48, and FAS regards the provisions that would have requires them to disclose to shareholders their tax risks associated with taking tax deductions they were not entitled to. Skeptical Shareholder (former) –Jul 11, 2011 19:31:39 PM
FIN 48 and FAS 109 (not FAS 142).Skeptical shareholder (former) –Jul 11, 2011 19:34:12 PM
I'm a shareholder of Newmont Mining. I've owned it for 5 years. Shareholders are the owners of this company. Despite the price of gold having more than doubled in that period of time, Newmont Mining stock has done zilch. Shareholders, i.e. the owners of this company, have made less than one percent in annual dividends, until last year when the dividend was raised to 1.1%.
The extremely well-paid management of Newmont, who HAVE made vast amounts of money, have apparently blown whatever profits there were. So before Nevada politicians start taxing those profits, remember that it will come out of the hide of shareholders, who will likely lose their meager 1.1% if Nevada decides to tax Newmont. fred s –Mar 22, 2011 22:01:34 PM
If the shareholders don't get their dividend, then take it up with management, but NV has been gettign screwed by mining since 1865, and it's time for NV to reap some benefits from it's natural resources.
Perhaps tell your mining companies to move to "low tax" Nevada which is supposedly such a huge attraction for companies of all kinds, yuet where are the mining companies located?!?! Canada and other states, which ALL have higher taxes than Nevada?!?!?!Bertsos –Mar 23, 2011 10:56:37 AM
So let me get this right, you are complaining about being paid your 1.1%dividends when the teachers are getting ready to take a 7.8% pay cut in Clark County? It kind of seems a bit unfair that you are complaining about a .1% dividend raise but teachers in Clark County haven't had an raise in their paycheck for a few years.
Also, if mining doesn't pay it's fair share of taxes, our state budget will be sure to leave EVERYONE worse off, not just you and your .1% increase in dividends.
Andrea –Mar 29, 2011 11:38:30 AM
Sarah Palin did not establish the PFD in Alaska it has been in place for 20 years
Maria Huff –Mar 22, 2011 10:04:29 AM
the PFD in Alaska was established in 1976 it exists as a semi independent enity ...
established by Gov Jay Hammond.Maria Huff –Mar 22, 2011 10:08:40 AM
It is way past time the mining industry pay its fair share.
mike whalum –Mar 22, 2011 10:03:29 AM
Yes it is way past time mining to pay thier fair share.. but it should go directly to the people.. Maria Huff –Mar 22, 2011 10:10:32 AM
Last I checked, no one was talking about an income tax - except the panelists. We are talking about an extraction tax, based upon gold taken out of the ground...res in lv –Mar 22, 2011 09:58:28 AM
All lies...read article from NYT March 16,2011 about, Hard Rock mining. Sen Reid has failed our state in every way... and the carpetbaggers of Nevada keep re-electing him.........challengergrey –Mar 22, 2011 09:47:16 AM
Why are mining companies allowed to make deductions from property taxes?
At the beginning of the discussion, it was stated that there is no income tax in NV, and, therefore, the mining companies are really only paying property tax. So, how is it that they can deduct expenses? As a homeowner, I get no deductions from my property taxes.Tim Weber –Mar 22, 2011 09:42:50 AM
Nevada is one of only two states that does not have a does not have a compulsory reclamation law, it still accepts "self guarantees" This is really inappropriate if one travels through Nevada's mining country and sees first the hand the highly scared land scape, and most importantly the degradation and chemical pollution of the water sources.
The legislature should address a comprehensive mining reformation law, not piecemeal the antiquated mining laws.
Our water and air quality are at stake.
Thank you Stacy StandleySTacy Standley –Mar 22, 2011 09:40:39 AM
Leakage???? Now the justification is TRICKLE DOWN????res in lv –Mar 22, 2011 09:40:20 AM
Great for the mining communities. In what way would the side benefits stop if the mines actually paid their fair share? Lights on the field/ community participation will not end...................................I get it, the mines are good, but PAY YOUR TAXES!!
res in lv –Mar 22, 2011 09:36:18 AM
Nonsense... The state set up the tax, but the give-aways are a scam.......................
Also, if the mining company sets up a future/set price it is the management's risk/responsibility.res in lv –Mar 22, 2011 09:33:33 AM
Since mining often can not produce any taxable product from their mines, should/can the state seize the mines by eminent domain? After all it seizure would be for the public good. res in lv –Mar 22, 2011 09:29:25 AM
Does Sen Leslie believe that this should continue?? What is she willing to do to change this?res in lv –Mar 22, 2011 09:08:10 AM
(Reuters) - U.S. gold miner Newmont Mining Corp (NEM.N) and Canada's Agnico-Eagle Mines (AEM.TO) said on Monday they expect increasing demand for gold as a monetary asset to send the price up to levels of $1,500 to $1,600 an ounce in the next 12 months.................................................Unless governments take steps to stave off growing inflationary trends, Richard O'Brien, president and CEO of Newmont, the world's second largest gold miner, said gold's value as a protection against inflation could lead it to $1,750 an ounce or higher in several years, possibly by 2012 ............................................The higher gold price would mean silver could surge to $40 to $50 an ounce, he said, "And I don't think that's wild."..................................................
http://www.reuters.com/article/2011/03/22/us-mining-summit-gold-price-idUSTRE72K66Q20110322res in lv –Mar 22, 2011 08:43:42 AM
remember, Jones Vargas was the firm where Brian Sandoval used to work. Could we explore this "uncomfortable" fact?
Also... Start with the fact that it is OUR GOLD, OUR MINERAL RESOURCES The resources of this state belong to the citizens.
If mining firms are so incompetent that they can't do the accounting, or are working mines that produce no taxable value, why are we letting them take our minerals?
Is our legislature so incompetent in representing us that they allow this to happen?
Could we have a little historical perspective? When the constitution was written, I imagine the only two economic powers in this state were ranching and mining. This is how the citizens in this state were sold out. Times have changed, and it is time to pay the piper. The citizens of this state have been dancing to "mining music" for far too long.res in lv –Mar 22, 2011 08:18:27 AM
I attended a Tax Commission hearing yesterday in Carson City about auditing mining companies because of their numerous deductions to the net proceeds tax.
It makes no sense that the price of gold is $1,400-plus an ounce and the amount paid under the net proceeds has gone down as gold prices have risen.
Mining always complained about bust years. But this is boom time. And the industry has taken every allowable and every other exemption known to creative budgeting. They exempt their marketing costs, their lobbying costs, the costs to fly the gold out of this country.
This is indicative of an industry that does not want to pay its fair share. Erin Neff –Mar 22, 2011 06:55:30 AM