According to the authorities, the American mining company has only paid $600 in taxes on $24 billion in revenue since 2008.
Malawi is demanding more than $300 billion to the US company Columbia Gem House for unpaid tax receipts on gemstones mined in Malawi and exported to the United States, we learned on Friday evening.
A letter from Justice Minister Thabo Chakaka Nyirenda, dated Tuesday and addressed to Columbia Gem House, accuses the US company of evading customs duties on sales of rubies and sapphires mined from its Chimwadzulo mine, in Ntcheu, Malawi since 2008.
Contacted by AFP, Mr. Nyirenda confirmed being the author of the letter, claiming that Nyala Mines Limited, a subsidiary of Columbia Gem House, only paid around $600 of x27;taxes on the estimated $24 billion in revenue from its operations in Malawi.
It demands that the company pay $309,600,000,000 in taxes in Malawi, a sum more than a hundred times greater than the annual budget of the poor country.
The Company and its subsidiary violated their fiduciary duties and the law in Malawi when they failed to disclose all income earned from the investment and when they engaged in improper business practices and to improper transfer pricing techniques in the exploration of rubies and sapphires, he claims.
Mr. Nyirenda adds that Malawi reserves the right to take criminal action against these companies and anyone involved in tax evasion and fraudulent export invoicing.
Malawi's position is that you have dishonestly changed the name of the mining company to Nyala Mines Limited to hide the origin of the company, i.e. so that the new name of the company sounds local to avoid suspicion and detection, says Mr. Nyirenda.
He further accuses Nyala Mines and Columbia Gem House of fraudulently exporting rubies and sapphires from Malawi, unjustly enriching themselves by not paying taxes and anticipated royalties.
Nyala Mines Limited and Columbia Gem House did not immediately comment.