The plunge in the share price of St Barbara Limited ended after the gold miner rejected a tax claim made against one of its subsidiaries by the Papua New Guinea (PNG) Government.
St Barbara (ASX: SBM) rose A$0.02 (10%) to A$0.22 on Friday, rebounding from the 25% plunge on Tuesday prompted by the company’s disclosure that a subsidiary had received a PNG tax assessment for the equivalent of A$210 million.
St Barbara said its wholly-owned subsidiary Simberi Gold Company Pty Ltd’s PNG tax agent had received correspondence from the PNG Internal Revenue Commission (IRC) with details of assessments of additional taxes and a 200% penalty totalling PNG Kina (PGK) 523 million ($210 million).
A total of PGK 435 million related to the calculation of Allowable Capital Expenditure asset values since 2006 and depreciation deduction claims from 2017-2021, and PGK 88 million related to a deemed dividend withholding tax, assessed on a debt-to-equity transaction on the re-capitalisation of Simberi Gold in 2018.
“St Barbara and Simberi Gold reject the IRC’s arguments that underpin the assessments and are committed to working with the IRC to reconsider this flawed assessment in its final determination,” St Barbara said in an ASX announcement.
St Barbara said the assessment would be appealed within 60 days appeal period.
The company said the IRC had reached back beyond the five year period permitted for amended assessments and inappropriately re-opened prior tax returns by claiming that Simberi Gold had fraudulently prepared its tax returns.
“St Barbara takes this assertion very seriously and will vigorously defend it. Simberi Gold has utilised reputable tax advisors within PNG throughout the relevant periods, has made full and true disclosures of all material facts and strongly rejects any suggestion of dishonest conduct of any nature whatsoever,” it said.
St Barbara is capitalised at $216 million at the latest price.